Preamble

The House met at half-past Two o'clock

PRAYERS

[Mr. SPEAKER in the Chair]

PRIVATE BUSINESS

ANGLIAN WATER AUTHORITY BILL [Lords] (By Order)

Order for Second Reading read.

To be read a Second time upon Thursday next.

TRADE

Address for Return
of Statistics relating to Overseas Trade of the United Kingdom for each month during the year 1977.—[Mr. Meacher.]

Oral Answers to Questions — AGRICULTURE, FISHERIES AND FOOD

Inshore Fishermen (South Coast)

Mr. Warren: asked the Minister of Agriculture, Fisheries and Food what part his Department is taking in talks with other Governments concerning the protection of the livelihoods of inshore fishermen working from South Coast harbours.

The Minister of State, Ministry of Agriculture, Fisheries and Food (Mr. E. S. Bishop): The Ministry is involved in talks with the Foreign and Commonwealth Office and other Departments in negotiation with the Community to safeguard the interests of everyone in the fishing industry, including South Coast fishermen.

Mr. Warren: Does the Minister realise that fishermen all along the South Coast are getting very worried about the failure of both his Department and the Foreign Office in Brussels to fight as hard as is necessary for those fishermen's protection, and that they view with great

trepidation the massacre of the fishing fleets that they have seen to the north and wonder whether it will come to them as well?

Mr. Bishop: The hon. Gentleman will recall the meeting that he had with me and my officials on matters of enforcement, and the fact that he has himself been to sea with the enforcement fleet to see what really happens. In further answer to his original Question, my officials have been in touch with the Belgian authorities on various matters affecting that part of the coast, and we are still in touch. In the matters now being discussed here in regard to our Fishery Limits Bill, there may be ways of overcoming some of these problems.

Mr. Luce: Has the Minister made it absolutely clear in Brussels that all the evidence from the Sussex inshore fishermen is that the Belgians have far exceeded their quota? How can our inshore fishermen possibly have faith in a system which is grossly abused by other countries?

Mr. Bishop: According to my information, there is no evidence of this. According to the latest NEAFC figures, relating to the period January-September last, Belgian fishermen have taken less than the average amount of their quotas for both sole and plaice. We are in close touch with the Belgian authorities to see that enforcement is effective.

Devolution

Mr. Spence: asked the Minister of Agriculture, Fisheries and Food what proposals he has for the agriculture industry in respect of devolution.

The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. Gavin Strang): Schedule 7 of the Scotland and Wales Bill provides that some of my Department's functions will be transferred to the Welsh Assembly. Schedule 6 provides for the transfer of a number of similar functions of my right hon. Friend the Secretary of State for Scotland to the Scottish Administration. Responsibility for the main aspects of agricultural policy will remain with the United Kingdom Government, since they are too bound up with the management of the national economy, membership of the Community and international agreements to make devolution practicable.

Mr. Spence: I thank the hon. Gentleman for that interesting answer. Can he not be a little more specific and say, for example, what will happen to marketing boards under the devolution proposals? What will happen to the agricultural colleges, particularly in Scotland, under devolution and what will happen to EEC grants? None of these items is clear, either in the devolution Bill or from the Minister's answer.

Mr. Strang: There is no question of devolving responsibility for the agricultural marketing boards, or of different rates of agricultural grant, under the Community schemes, being payable in Scotland and Wales as compared to England.

Mr. Crawford: Will the hon. Gentleman tell the farming industry in Scotland that the best thing that can happen, and that will happen, to it is self-government? Will he inform the industry that one way in which the difficulties of the green pound can be eliminated in Scotland is through the establishment of a strong pound Scots?

Mr. Strang: No. My understanding is that the NFU for Scotland very much values the fact that Scotland is part of the United Kingdom.

Mr. William Hamilton: What is or has been the official reaction of the Scottish NFU to the Government's proposals for devolution?

Mr. Strang: My right hon. Friend the Secretary of State for Scotland has had discussions with the National Farmers' Union for Scotland and I believe that it is reasonably happy with the proposals in the Bill.

Agricultural Land (Urban Development)

Mr. Dudley Smith: asked the Minister of Agriculture, Fisheries and Food how much land was lost to agriculture and forestry, respectively, during the last 12 months as a result of urban development.

Mr. Strang: I assume that the hon. Member is referring to England alone, but I regret that the information is not available in these precise terms. For the five-year period ending June 1975, the latest period for which information is available, it is estimated that nearly 30,700 acres of agricultural land were

lost each year to urban, industrial and recreational use excluding mineral workings. Figures for comparable losses of forestry land are not available. This information is taken from the returns in the annual agricultural census.

Mr. Smith: Is the Minister aware that if we go on squandering our inheritance at this rate, generations to come will curse us for our folly? Is he further aware that a comparatively small county like Warwickshire loses about 5,000 acres a year? Is it not time that there was a real effort to redevelop derelict land?

Mr. Strang: Yes; I am in sympathy with the hon. Gentleman. The Government are very conscious of the need to protect agricultural land. That is why we recently persuaded Parliament to impose a statutory obligation upon local authorities to consult the Ministry of Agriculture about any proposals to develop agricultural land.

Mr. Peter Mills: Does the Minister realise that in the South-West of England there are proposals to flood hundreds of acres of good agricultural land for a reservoir? Will he watch this position very carefully, as we simply cannot afford to go on wasting agricultural land?

Mr. Strang: I absolutely agree that there must be no unnecessary loss of agricultural land. It is worth keeping this matter in perspective by reminding ourselves that the total annual loss of land from agriculture is running at about 0·3 per cent. per year, whereas the expected rate of increase in production is about 2½ per cent. But I agree absolutely with the hon. Gentleman's general observation.

Mr. Park: Is it not a fact that in the area referred to by the hon. Member for Warwick and Leamington (Mr. Smith) and in the West Midlands generally we get only half the grant that people in other areas get to reclaim derelict land?

Mr. Strang: My hon. Friend is presumably comparing the position in his area with that in development areas. This is obviously not a matter for the Ministry of Agriculture, but I shall consider what my hon. Friend has said.

Pigmeat

Mr. Hicks: asked the Minister of Agriculture, Fisheries and Food what measures


he proposes to introduce to alleviate the financial difficulties facing producers of pigmeat.

Mr. Boscawen: asked the Minister of Agriculture, Fisheries and Food if he is satisfied with the reduction he achieved in November in the MCA's payable by the Commission to the exporters of pigmeat to the United Kingdom.

Mr. Watkinson: asked the Minister of Agriculture, Fisheries and Food if he remains satisfied with the returns presently available to pig farmers.

Mr. Bishop: I recognise the difficulties facing the pigmeat sector and share the concern felt by both pig producers and pigmeat processors about the effect of monetary compensatory amounts on their competitive position. My right hon. Friend has made clear his belief that the interests of this sector will best be served by changing the way in which the monetary compensatory amounts for pigmeat are calculated, and he has put proposals to the Council of Ministers. The recently negotiated reduction of about 8 per cent. in these amounts is a step in the right direction, but it is not enough. We shall continue to press for further changes.

Mr. Hicks: Is the Minister aware of the urgency of the situation both in respect of the production of pigmeat and in the pigmeat processing industries? When can we expect action?

Mr. Bishop: The House should first be aware of the advantage of the 8 per cent. that has already been negotiated, which is worth £24 a ton on bacon this week. The MCA applied to bacon is now about £47 a ton below the peak level at the beginning of November. Despite this, we are still not satisfied, and my right hon. Friend is pressing for further urgent action in Brussels.

Mr. Watkinson: Is my hon. Friend aware that pig producers in my constituency are in a desperate situation at the present time, in that their revenue only just covers their feeding costs, let alone any other costs? If my right hon. Friend the Minister of Agriculture is unable to get any advantage out of the Common Market, will he bear in mind the need for direct assistance, if necessary, to the pig industry?

Mr. Bishop: It is very important that we should not be discouraged and should remember the advances already made. The fact that there has already been a change in the MCA rate is a recognition that there is no necessary link between that and the green pound, and that is a step in the right direction. If there were changes in the green pound it would worsen the feed cost situation, which is one of the factors in the problem. We are certainly taking urgent action to improve the position.

Mr. Boscawen: I am still not convinced that the Minister is really aware of the seriousness of the situation. Is it not a fact that pig production is in relatively few hands, unlike other branches of the agriculture industry, and that it is therefore most important that we get quick action on this, otherwise we shall find many pig producers going out of business?

Mr. Bishop: I am sure that my right hon. Friend is well aware of the points that the hon. Gentleman has made.

Mr. Hardy: Will my hon. Friend remind the House that the situation today, although severe, is nowhere near as serious as that which faced the present Administration when it took office in February 1974? Does he agree that, while the Government then took helpful action, helpful action is certainly required today?

Mr. Bishop: I appreciate my hon. Friend's comments. The fact is that United Kingdom bacon production is now about 46 per cent. of our total needs, as compared with 42 per cent. last year. But that is no reason for complacency, and we shall certainly be pressing for urgent action. We seek to ensure that the United Kingdom pigmeat processing industry is allowed to supply its products under fair competition, and this is what we are seeking in Brussels.

Mr. Peyton: Is the Minister aware that his answer betrayed absolutely no sense of urgency? Nothing that he said reflected the concern felt in the country. Is he aware that we seem now to be enjoying—if that is the word—a uniquely chilling combination? First, we are in receipt of massive charity from the Community. Secondly, we are increasing imports, for which we do not want to have to pay. Thirdly, we are ruining our own producers and processors. Is it not


a fact that the Danish producer selling here gets between £15 and £20 more for a bacon pig than a home producer gets?

Mr. Bishop: I do not think that the right hon. Gentleman provides any help for my right hon. Friend when he talks about the massive charity that we are getting from Brussels. My right hon. Friend has made it very clear that in many ways we are having to pay higher costs for food—[Interruption]. The fact is that the Council, by its acceptance of the 8 per cent. change, has accepted in principle the fact that changes can be made without a change in the green pound. We are pressing for further improvements to be made as soon as possible.

Mr. Hicks: In view of the very unsatisfactory nature of the Minister's reply, I beg to give notice that I shall seek an early opportunity to raise the matter on the Adjournment.

Common Agricultural Policy

Mr. Marten: asked the Minister of Agriculture, Fisheries and Food if he will make a statement on reform of the common agricultural policy.

Mr. loan Evans: asked the Minister of Agriculture, Fisheries and Food what proposals he intends to make to end or amend the operation of the EEC common agricultural policy.

The Minister of Agriculture, Fisheries and Food (Mr. John Silkin): As stated in the Gracious Speech, the Government will seek further improvements in the operation of the common agricultural policy.

Mr. Marten: That is all very well, but did the Minister read Hansard of 1st December, when, in answer to one of my questions, the Prime Minister told me that one of the problems in reforming the common agricultural policy was the vested interest of the various countries of the Common Market? As the common agricultural policy must now be one of the longest running farces in Europe, have the Government any positive proposals for its reform? If they have not and cannot overcome these vested interests, would it not be better to have a British national agricultural policy?

Mr. Silkin: It may just be conceivable that one may get a British national policy even inside the common agricultural policy. I said that Her Majesty's Government would be working for improvements, but to ask me to abolish the common agricultural policy is rather to overburden a hard-working Minister.
What I would say is that regardless of—or perhaps even because of—vested interests, our own not least, it should be possible to make some difference, for example, to support prices and to the structural surpluses. It should also be possible to make a considerable inroad into the objective of taking the social funds, which go into the price of food and into farm prices, out of the farm budget and putting them where they belong, which is into national social exchequers.

Mr. Ioan Evans: I congratulate my right hon. Friend on the fight that he is putting up in the EEC in defending the interests of British consumers, but does he realise that there is now widespread discontent about the way in which the common agricultural policy is operating? Will he tell the House something of the discussions that he had with the Trades Union Congress yesterday in reference to the CAP?

Mr. Silkin: I think that the TUC has already made quite a reasonable comment on our very useful discussions. We did not find ourselves totally in disagreement in principle. We were all certain that there should be certain major improvements in the common agricultural policy. I outlined the major ones a few months ago.

Mr. Scott-Hopkins: I accept that the Minister is doing his best for the consumer, but does he not realise that while he is doing that he is also clobbering several sections of the farming industry? The right hon. Gentleman has just heard about the difficulties in the pig industry. That is not the only industry in difficulty at the moment. While he is bending his mind to improving the CAP—which can be improved, and needs it—will he accept that the various proposals put forward by Commissioner Lardinois for rectifying surpluses should be accepted in principle?

Mr. Silkin: We have had quite a lot of discussion already about the pigmeat


industry. If the hon. Gentleman wishes to return to it, I should like to say that I negotiated a very small change in those MCAs; but considerably more than has ever been negotiated before.
I put to the hon. Gentleman and to the House what seems to me to be a very important point. We get a butter mountain, or whatever it may be, because the consumer cannot afford to pay the price. It is as simple as that. There are three positive examples of that in British agriculture. The first is that the high price of sugar two years ago caused a drop in consumption from which we have not fully recovered. The second is that there was an increase in the price of milk a little while ago, and, as Sir James Barker pointed out, there was a 2½ per cent. drop in the consumption of milk, which has only just been recovered. Finally, when potatoes were at their highest price at the beginning of this year there was a 25 per cent. drop in consumption.

Mr. Jay: As my right hon. Friend is so much more hard-working on this issue than was any of his predecessors on the Opposition Benches, will he tell us a little more precisely about the improvements in the CAP for which the Government are working?

Mr. Silkin: As I said a moment ago, the first thing we must do is stop insane price increases. Secondly, we must put an end to the structural surpluses. Thirdly, we must work to remove from the farm budget social measures, which should be the responsibility of individual Governments.

Mr. Peyton: Perhaps the right hon. Gentleman will explain what he means by insane price increases? Does he mean to go on from that to say that he is in some way inhibited from seeing producers actually recover the costs of production?

Mr. Silkin: I am glad to have the opportunity to explain. I mean that we spend far too much of the Community's resources on subsidising inefficient foreign farmers when, for example, the efficient British industry, equipped with the most modern machinery—that means investment aids, and not, as in the proposed milk package, banning investment aids for three years—is capable of producing more effectively and more cheaply. If

that does not benefit the consumer, I do not know what does.

Common Fisheries Policy

Mr. Wall: asked the Minister of Agriculture, Fisheries and Food if he will make a statement on the progress of negotiations for an exclusive British fisheries limit.

Mr. Henderson: asked the Minister of Agriculture, Fisheries and Food if he is satisfied with the progress of renegotiation of the common fisheries policy.

Mr. Mudd: asked the Minister of Agriculture, Fisheries and Food what is the state of his negotiations with the EEC Council of Ministers concerning the internal régime of the common fisheries policy.

Mr. John Silkin: The Commission made formal proposals to the Council in September. In important respects these are completely unacceptable. We will continue to press for adequate recognition of United Kingdom interests in the future common fisheries policy, which will again be discussed at a Council meeting devoted to fishery issues on 14th December.

Mr. Wall: I recognise the right hon. Gentleman's difficulties, but is he aware that the industry is becoming increasingly concerned at the lack of progress? Will he confirm that in legislation now passing through the House he has the power to impose an exclusive 50-mile British fisheries limit? Does he propose to use those powers?

Mr. Silkin: I am very much aware of and deeply sympathetic with the problems of the fishing industry. I think I carry the hon. Gentleman with me when I say that it is vital to have the necessary powers. As for the 50-mile limit as an exclusive zone, the powers lie within the Bill. When talking about 50 miles, we must not forget that it cannot be 50 miles right the way round, as that would take us into France, overland. There must be a median limit. If the hon. Gentleman looks again at the proposals of 4th May of my right hon. Friend the then Minister of State, Foreign and Commonwealth Office, he will see that while the basis of those proposals


may not have been a 50-mile limit, throughout, they did protect our own fishing industry.

Mr. Henderson: Is the right hon. Gentleman aware that the continued dragging out of these negotiations is a source of concern and uncertainty for the whole fishing industry? From his knowledge of the way in which the negotiations are proceeding, is he able to give us an indication of the time scale he has in mind for reaching a successful conclusion in terms of our own interests in this matter? Does he feel that the time may be approaching when we should set a deadline, when we shall expect to have an agreement or shall have to take unilateral action?

Mr. Silkin: I am extremely concerned about the urgency of this matter. I appreciate the hon. Gentleman's point about time. Time is going by and in the meantime we have not settled these negotiations. The hon. Member for Haltemprice (Mr. Wall) kindly pointed out that there are certain difficulties in respect of the negotiations. We started, for example, with the original Treaty of Accession and the limits laid down within it. I can assure the hon. Gentleman that I shall do my best, as forcefully as possible, to ensure that the United Kingdom's position is fully understood, realised and taken into account as speedily as possible.

Mr. Mudd: Does the right hon. Gentleman accept that there is a growing fear on the part of the Cornish inshore fishing industry that there is nothing to preclude either Soviet or East European fishing interests seeking to set up operating companies registered in the United Kingdom, in which event they will be able to fish legally, notwithstanding any British decision on a fishing limit?

Mr. Silkin: I freely confess to the House that that is a proposition to which I was not directing my mind. I thought it would be difficult enough to get us into a situation in which we would be able to deal with the Eastern European countries by themselves, but I shall look into the matter.

Mr. McNamara: Is my right hon. Friend aware that the chairman of the Opposition's Fisheries Committee stated at the time of accession that he was

perfectly satisfied with the arrangements made for the fishing industry? Is he also aware that I and my colleagues from Hull have an amendment tabled for tomorrow's Bill that will provide for a 50-mile limit around the country, making provision for the median line to which my right hon. Friend referred? Does he appreciate that the best demonstration he could give the British fishing industry of the Government's intentions would be to clasp our amendment to his bosom?

Mr. Silkin: I was aware of my hon. Friend's first point. I listened closely to the splendid reassurances that were given when we were debating the issue. On his second point, I think it would be of advantage if my hon. Friend were again to look at what my right hon. Friend the then Minister of State said on 4th May. If he studies it carefully, he will find that there is not all that much difference between us.

Mr. Grimond: I welcome the firmness of the Minister's statement about the urgency of this matter and hope that he will remain firm, but will he make it clear that there is nothing in the Treaty of Rome that entitles members of the EEC to fish up to one another's shore s? Is he in concert with the Irish, who have made their position clear and who equally have a deep interest in maintaining a 50-mile limit?

Mr. Silkin: On inshore fishing, the Irish problem and our own problem are very much related. I agree with what the right hon. Gentleman says about the Treaty of Rome. What worried me was the Treaty of Accession.

Mr. Jopling: Does the right hon. Gentleman understand that around the country there is a great deal of feeling, especially in fishing communities, that he does not fully understand the fears of those communities? Is he aware that they fear that he does not fully understand their position in the course of these negotiations? Does he understand that there is even greater fear that having established an exclusive zone within the 200-mile limit it will then be impossible to police it as he has not yet fully got down to the important matter of policing? Does he understand that it is no use having an exclusive zone unless we can enforce it?

Mr. Silkin: I deal first with the hon. Gentleman's last point. I am sorry that he missed the Second Reading of the Fishery Limits Bill. Had he been present he might have had some reassurance. On his first point, I hope that the fishing communities understand that I share and understand their fears. Indeed, I understood their fears at the time of the Treaty of Accession.

Beef Imports

Mr. Jay: asked the Minister of Agriculture, Fisheries and Food when he intends to remove the present restrictions on imports of beef into the United Kingdom from outside the EEC.

Mr. Strang: The European Commission has announced that it envisages lifting on 1st April 1977 the safeguard clause under which imports of beef into the EEC are at present restricted. The Council of Ministers is discussing the new arrangements under which imports will be allowed, once the safeguard clause has been lifted.

Mr. Jay: Is my hon. Friend aware that large supplies of beef are now available in Australia, Argentina, Brazil and elsewhere, which could be sold to British housewives at not much more than half the present price, and that nothing stands in the way of this except the extreme protectionism of the EEC? Is not this, indeed, an example of an insane price increase?

Mr. Strang: My right hon. Friend is right to draw attention to supplies of beef that exist in Australia. Australia has suffered from the closure to her of the Community market, together with the Japanese and American markets. We hope that the liberal import arrangements for which we are pressing will enable Australian beef to come into the Community after 1st April.

Mr. Nicholas Winterton: In any steps that the hon. Gentleman is disposed to take, will he act in the interests of our farmers and ensure that the British beef farmer is not totally undermined by cheap imports? The future of the country depends on our farmers producing more of the food that we require from our own resources, which is the title of his Government's own document.

Mr. Strang: A supplementary question of that kind comes ill from the hon. Gentleman. It was the present Labour Government who, in renegotiating the CAP, secured the variable premium for farmers, for which they continue to be grateful, and my right hon. Friend is determined to maintain it.

"Land for Agriculture"(Report)

Mr. MacGregor: asked the Minister of Agriculture, Fisheries and Food what action he intends to take in the light of the report on "Land for Agriculture" recently published by the Centre for Agricultural Strategy.

Mr. Strang: This is a useful report, which is already arousing interest and stimulating discussion. My Department is studying it.

Mr. MacGregor: Is the hon. Gentleman aware of Lord Rothschild's comment in introducing this report, that it frightened him to see what we were doing with agricultural land—a commodity as valuable as North Sea oil? Is the hon. Gentleman not concerned about the way that we continue to give up thousands of acres of good agricultural land each year to other uses when non-agricultural land is equally available? Will the hon. Gentleman therefore continue to pursue the suggestion made in the report—not just for consultation with local authorities but that his Ministry should assume full executive responsibility for the transference of agricultural land to other uses, which would strengthen the hands of agriculture against other planners?

Mr. Strang: I believe that the first report of the Centre for Agricultural Strategy is an important and valuable contribution to the consideration of this very important issue. I can assure the hon. Gentleman that we are looking at its conclusions carefully and that, in addition, we shall take into account the conclusions of the Agriculture Economic Development Committee Land Use Group.

"Food from Our Own Resources" (White Paper)

Mr. Michael Latham: asked the Minister of Agriculture, Fisheries and Food if he is satisfied with the progress of implementation of the White Paper "Food from Our Own Resources."

Mr. John Silkin: The Government stand firmly by the objectives set out in the White Paper, and we are determined to maintain the basis for further expansion in line with it.

Mr. Latham: To assist Britain's agriculture and in the light of some of the right hon. Gentleman's answers today, will he confirm that he and all his colleagues in the Ministry are fully behind and in full interior concert in supporting, the decision of the British people to remain in the Common Market?

Mr. Silkin: The hon. Gentleman speaks of the decision of the British people to remain in the Common Market. I notice that the Question is about the White Paper "Food from Our Own Resources" which, of course, was written before the renegotiation took place and, as the White Paper itself said, was capable of being operated in either circumstance.

Mrs. Dunwoody: Will my right hon. Friend continue to press strongly for the sort of expansion envisaged in "Food from Our Own Resources" and resist any attempt from our partners in the EEC to damage our own expansion? It is in this way that we can protect the interests not only of the farming community but of the consumer from the highly damaging and totally unrealistic milk and fisheries policies of the EEC.

Mr. Silkin: My hon. Friend, as always, puts her finger on the important point. In the present discussions on the milk action programme in Brussels I am asked to concede that such measures shall be taken as will make an effective 10 per cent. cut in dairy production throughout the Community, willy-nilly, but there are large areas of the Community which are thoroughly inefficient in dairy farming, where it should be scrapped. There are areas—our own, in particular—where the dairy industry should expand. If we expand our dairy industry by the most up-to-date and modern methods it benefits the consumer, because he gets its products cheaper.

Mr. Watt: Does the right hon. Gentleman recognise that instead of getting an expansion of production he will shortly get a contraction unless he does something about the green pound? Does he appreciate that many farmers are contemplating

putting their farms on a care-and-maintenance basis until the Government come to their senses? Will he at last see the sense of the proposal that I made to him months ago, that he should revalue the green pound by 1 per cent. a month?

Mr. Silkin: I do not want to be patronising, but the hon. Gentleman could usefully spend his time examining, first, what the green pound is all about and, secondly, what has happened to milk production. Last month, there was an increase, effectively, of 2p a gallon to the producer, which was made without the operation of the green pound.

Mr. Peyton: We are very glad to know that the right hon. Gentleman is still able to speak so favourably of the document "Food from Our Own Resources", but will he reassure the House by saying how he proposes to catch up with the target laid down in Table 2 of that paper, because we have fallen far behind the target set? What specific measures has he in mind?

Mr. Silkin: I shall not go into a long theological argument with the right hon. Gentleman about the use of the word "target". In fact, it is not a target; it is a projection. It arose because it was worked out with the industry itself, as one which was realistically capable of expansion. In the past few years, we have had, first, a bad drought and, secondly, the worst drought for 500 years. The drought was bound to have its effect. In fact, "Food from Our Own Resources" refers to
taking one year with another.
I understand that the EDC on Agriculture is already going into the question. We should be catching up relatively soon—assuming that there is such a thing as a normal year in farming, which sometimes I doubt—and should be absolutely ahead of what the right hon. Gentleman calls a target by the early 1980s.

Cereals Imports

Mr. Wells: asked the Minister of Agriculture, Fisheries and Food what is the current level of cereals imports; and what percentage this is of total home usage.

Mr. Bishop: From August 1975 to July 1976 the total amount of cereals


imported into the United Kingdom was 8·423 million tonnes. This represented 39 per cent. of our total cereals usage.

Mr. Wells: Is that an area in which the Minister intends to implement "Food from Our Own Resources"?

Mr. Bishop: Yes. The hon. Gentleman is right. He may have read page 9 of the document where we say:
The immediate prospect for higher output may therefore be mainly in feed grains, while research, development and other practical measures to raise the proportion of homegrown wheat in the bread grist should be pressed forward.
Of course, production depends on weather and other reasons, but the hon. Gentleman will also be aware of the amount of work being done by the Government, the Ministry and private enterprise in increasing the yield of barley and other cereals, which is an important factor.

Mr. Spearing: Will my hon. Friend tell the House the amount of money, in levies and taxes, imposed on the quantity of imported cereals that he quoted?

Mr. Bishop: My hon. Friend may be interested to know that imports from third countries pay a levy—less the ACA—and receive a subsidy in the form of an MCA. The net effect of this can vary. But when world cereal prices are high the MCA can often cancel out the levy.

Tree Planting

Mr. Bulmer: asked the Minister of Agriculture, Fisheries and Food what is the Government's target for planting over the next five years in both the public and private sectors.

Mr. Strang: I assume the hon. Member is referring to forestry. The Forestry Commission aims to sustain a planting and replanting programme of up to 55,000 acres a year in Great Britain which is in line with the conclusions of the recent forestry policy review. The Government provide grants for private forestry but the level of plantings is a matter for decision by individual owners.

Mr. Bulmer: Does the Minister accept that there has been a dramatic fall in private planting since the introduction of capital transfer tax? This has most serious long-term implications for our

balance of payments. Would he tell the House whether his Department is arguing in favour of relief from this tax with the Treasury working party?

Mr. Strang: Certainly I agree that there has been a drop in the number of private plantings in the past year, but it is difficult to be certain to what extent this is attributable to capital transfer tax. The industry has been depressed overall. There is an inter-departmental review group looking at the whole question of taxation, grants and amenities in relation to forestry. We hope to have its recommendations before the end of the year.

Mr. Hardy: Will the Minister accept that the cost of importing timber and timber products is very considerable and is likely to rise? Will he agree that the amount of planting—whether it be in the private or public sector—in the next 10 to 15 years must be higher than the total for the past two years?

Mr. Strang: I agree that it is in the national interest that there should be an increase in planting in this country.

Mr. Shepherd: Will the Minister tell the House what steps he is taking to find out whether private sector plantings are influenced by capital transfer tax?

Mr. Strang: There is a tendency for the Opposition to ignore the very significant concession incorporated in the 1975 Finance Act that is specifically designed to help private woodland owners. However, we are looking again at this whole question of taxation in relation to private forestry.

Fishing Fleet

Mr. David James: asked the Minister of Agriculture, Fisheries and Food what measures he will be taking to encourage the expansion of the United Kingdom's existing fishing fleet.

Mr. Bishop: The future shape of the United Kingdom's fishing fleet will depend on the outcome of common fisheries policy and other discussions.

Mr. James: Does the Minister agree that in any event the British trawler fleet will have to diversify its fishing grounds, in particular, fishing for blue whiting at far greater depths? Will he take steps to


advise and assist trawlermen in building new trawlers or adapting existing ones to deal with the increased technological problems involved?

Mr. Bishop: The hon. Member will appreciate that it has been very difficult for some time to anticipate the future shape of the industry, and this matter is being urgently pursued in the EEC Commission. As far as the reapraisal of the future of the industry is concerned, the hon. Member has touched on another important point—the use of species such as blue whiting, which are much more plentiful, and the effective marketing and processing of these to ensure that they are made attractive to the consumer. My Ministry is pursuing these matters.

Mr. Powell: Does the Minister recognise that the maintenance, let alone the expansion, of the fishing industry depends on conservation, and that conservation can only be effectively secured by exclusive control?

Mr. Bishop: Conservation is a very important matter, which, fortunately, every country accepts. We are pursuing these matters in Brussels. As for exclusive control, this is a mattter which we hope will be resolved in the near future.

Mr. James Johnson: Does the Minister agree that the two most important factors in the expansion of any industry are capital investment and the working conditions of the men inside the industry? Will he tell the House and the unions involved what he is doing about the decasualisation of the deep-sea fishing industry?

Mr. Bishop: I recall the useful contribution which my hon. Friend made in the discussions upstairs yesterday on the two schemes, when we discussed further grants and loans aid to the industry. I reminded him that urgent consultations are taking place with the industry and the trade unions on these important matters. I stressed also the importance of working conditions for those in the industry. That is why we are pursuing talks with the trawler industry and its employees.

Mr. Stephen Ross: Will the Minister tell us what representations his Department is making to the Secretary of State for Defence to ensure that the 200-mile limit is adequately patrolled?

Mr. Bishop: I do not recall whether the hon. Member was present last Friday when we debated the Fishery Limits Bill. During that debate this matter was discussed in some detail, and assurances were given that we have in mind increased enforcement of measures, both at sea and in the air. I accept the importance of this matter.

PRIME MINISTER (ENGAGEMENTS)

Mr. Christopher Price: asked the Prime Minister if he will list his engagements for 9th December.

The Prime Minister (Mr. James Callaghan): This morning I presided at a meeting of the Cabinet. In addition, I shall be holding meetings with ministerial colleagues and others.

Mr. Price: Will the Prime Minister find some time in his very busy day to study the vexed question of the Opposition's policy on devolution? Will he give us the latest tally of Opposition spokesmen who have resigned? Some of us find it very difficult to keep up with it. In view of the debate next week, can the Prime Minister tell us which is the official Opposition—that led by the right hon. Member for Sidcup (Mr. Heath) or that led by the right hon. Member for Finchley (Mrs. Thatcher)?

Mr. Nicholas Winterton: We are not impressed.

The Prime Minister: As far as I know, there have been only two resignations from the Opposition Front Bench. At least, the hon. Member for North Angus and Mearns (Mr. Buchanan-Smith) and the hon. Member for Glasgow, Cathcart (Mr. Taylor) have one thing in common—neither the one who has resigned nor the one who has taken his place is in favour of the official Tory Party policy. I cannot really add to the present knowledge of the House, except to say that I believe that in addition to those who have resigned there are a number of walking wounded still on the Opposition Front Bench.

Mrs. Thatcher: Is the Prime Minister trying to deflect attention from one of his more important duties, namely, the repaying of the loan that he borrowed six months ago, which is due to be paid


back today? Will he confirm that the loan has been repaid on time? Will he tell us exactly how much of the standby credit was used and paid, and the source of the repayment.

The Prime Minister: Yes. The right hon. Lady will be rather disappointed to hear that the loan is being repaid exactly on time. It will, of course, be taken from reserves and replaced in due course by the IMF loan on a longer-term basis. As to the other matters which the right hon. Lady has raised, these figures will be published in due course.

Mrs. Thatcher: That is not good enough. The Prime Minister says that the loan has been repaid, but how much was it?

The Prime Minister: That figure will be published in due course, and once again I think that the right hon. Lady will be disappointed to find that it is smaller than she hopes.

Mr. Grimond: Getting back to the subject of devolution, as the Prime Minister has a comparatively light day will he send an answer to the Shetland Islands Council in response to its excellent letter on this subject? Will he let us know what his answer will be? [Interruption.]

The Prime Minister: In reply to shouted comments from the Opposition that I should know the figure for the loan, of course I know it. But I am afraid that hon. Members opposite will have to contain their impatience. I always thought that there was a tradition of individual hon. Members asking questions, and not a Greek chorus. Of course they would much prefer it to be a Greek tragedy.— [Interruption.] In reply to seated supplementary questions, there are fixed dates for publishing this kind of information. These dates will be adhered to, and hon. Members should know that those are not the sort of questions which are likely to prompt an answer.
I note what the right hon. Member for Orkney and Shetland (Mr. Grimond) says about the letter. I am considering an appropriate reply.

Mr. Bryan Davies: Since the Opposition do not want to discuss devolution today, will the Prime Minister fit into his engagements an opportunity to chat

with Lord Goodman and ask him how he can define Eton College as a beneficiary of charitable status?

The Prime Minister: I was not really thinking of discussing this matter with Lord Goodman, because there are many other issues, especially on devolution, which engage my attention at present. However, I know that the question of devolution, which will engage the House for some time, can be added as one more policy on which the Opposition are completely at sixes and sevens.

GOVERNOR OF THE BANK OF ENGLAND

Mr. Warren: asked the Prime Minister when he next plans to meet the Governor of the Bank of England.

Mr. Blaker: asked the Prime Minister when he next expects to meet the Governor of the Bank of England.

Mr. Wyn Roberts: asked the Prime Minister when he next plans to meet the Governor of the Bank of England.

Mr. Tebbit: asked the Prime Minister if he will meet the Governor of the Bank of England.

Mr. Michael Spicer: asked the Prime Minister when he next plans to meet the Governor of the Bank of England.

The Prime Minister: I have no immediate plans to do so.

Mr. Warren: Will the Prime Minister assure the House that before the Letter of Intent is given to the IMF he will consult the Governor of the Bank of England about it and will publish it in this House? Is that not particularly pertinent, bearing in mind that it was only 31 years ago this month that the Prime Minister nearly lost the Bank of England fringe benefit of the IMF for this country, when he voted against its establishment?

The Prime Minister: No. My recollection is better than the hon. Gentleman's history. What I, with a number of other hon. Members, including a number of Conservatives, voted against at that time were the conditions that were


exacted. Some of us are still in the House. I always thought that those conditions were quite wrong. I do not like to say "I told you so", but I think that it was wrong that the condition should have been exacted that we should return to the doctrine of convertibility of exchanges within two years at the end of the war. That was a basic reason why most of us voted the way we did, and those events are well within our recollection.
As to the earlier question, the Governor of the Bank of England will be consulted about these matters, the Cabinet having reached its conclusions. I think that the hon. Gentleman should put to my right hon. Friend the Chancellor his question about publication of the document. I am not sure what the form is, but obviously the House would be among the first to know.

Mr. Blaker: Is the Prime Minister aware that the Government are now in breach of Schedule 5 of the Industry Act 1975, which lays upon the Government the obligation to publish by 20th November forecasts of the national economy? Is this not another deplorable example of the Government's failure to tell the country the truth about the economy? Will the right hon. Gentleman ensure that this situation is rectified before the forthcoming economic package is revealed?

The Prime Minister: I am not aware of the date on which the forecast has to be published. That is a matter for the Chancellor. I am not a catch-all for questions to everyone else. I am most indulgent about some of the questions I am prepared to answer. Since, on the whole, they give me the opportunity to educate Conservative Members, I sometimes do not mind answering them.
I shall certainly look into the question of the date of publication of the forecast, and see that it is published. I agree that if we are to have a debate on the Government's measures the forecast should be published before them. I give that undertaking now. However, on the whole I am not sure how much light it will add. It seems to me that the clutch of forecasts such as we are getting now creates more confusion than enlightenment.

Mr. Atkinson: Will my right hon. Friend clear up the confusion that has been caused by the rumours circulating throughout the banking community and in the City that on two recent occasions he has given assurances to that community that there will be no nationalisation of the clearing banks by either this Government or the next Labour Government? Will he now clear up this matter and say whether he is looking at any alternatives to those contained in the document circulated by the Labour Party?

The Prime Minister: My hon. Friend should not be in any confusion about this. He was present when I read a statement to the National Executive Committee at Blackpool. He commented on it at the time, so he knows exactly what the position is—[interruption.] My relations with the National Executive Committee are nothing to do with the Opposition.

Mr. Tapsell: Tell us; tell the House of Commons.

The Prime Minister: As for the future of the City and the banking industry, the committee that is to be established under my right hon. Friend the Member for Huyton (Sir H. Wilson) will, I am sure investigate all these matters. A strong team is being assembled. If the hon. Member for Horncastle (Mr. Tapsell) is not careful, I shall not put his name forward for it.

Mr. Tebbit: As the Prime Minister has had some months to consider his application to the IMF for further loans, would he be able to tell the Governor of the Bank of England, even if he could not tell this House, whether it has been the unanimity of his Cabinet or the division within it that has prevented his getting the Letter of Credit prepared by 9th December—that is, today—when, as he has already said, he was due to pay back money which this Government had earlier borrowed?

The Prime Minister: There is no particular connection between the Letter of Intent for the IMF and the repayment of the credits that we have had. There is therefore no reason why the two should coincide. This is not a matter that I would discuss with the Governor of the Bank of England, but if I did I think I


should get more sense out of him than I should out of the hon. Gentleman.

Mr. Wrigglesworth: Does my right hon. Friend agree with the Select Committee Report on the Bank of England which was published yesterday, saying that charges for fringe benefits provided for staff of the Bank of England should be brought more into line with the levels charged to the general public?

The Prime Minister: This is a Report of a Select Committee of the House, and the Bank of England will want to take seriously what is said. I agree that some of the conditions that have no doubt been negotiated with the staff seem to be on the generous side, but the Government will have to prepare their view on the matter and publish a White Paper in due course. Before that happens I dare say that the Bank of England will want to consider what the Select Committee said.

Mr. David Steel: When the Prime Minister meets the Governor of the Bank of England, will he discuss with him the interesting observations of the Director General of NEDO the other day about the contribution to our economic failure that has been made by our party political structure, with what he described as
its obsessive concern with short-term pressures and its destructive concepts of adversary politics."?

The Prime Minister: No. I shall not discuss that with the Governor of the Bank of England. I may discuss it with the Director General of NEDO, who, I think, seems to be straying a little beyond what is his proper concern at present.

CBI

Mr. Brittan: asked the Prime Minister when he last met the CBI.

The Prime Minister: I refer the hon. Member to the reply which my right hon. Friend the Lord President of the Council gave on my behalf to my hon. Friend the Member for Bolsover (Mr. Skinner) on 30th November.

Mr. Brittan: Did the Prime Minister, when he last met the CBI, tell it that he did not propose to carry out his obligations under the Industry Act over the disclosure of information and that when

asked about it in the House he would reply in a cavalier fashion, showing that he was not concerned about maintaining his obligations under the law to give the disclosure required by the Act?

The Prime Minister: The answer to all parts of that question is "No, Sir".

Mr. Skinner: Will my right hon. Friend confirm that probably not too many members of the CBI live in bedsitters? Does he agree that many of the people who do live in bedsitters vote Labour? Will he confirm that many of those in bedsitters who vote Labour and who are members of the Labour Party have not been lucky enough to be rewarded by that Labour Party to the extent of finding themselves with a seaside bungalow, a country cottage and a town house? Does he agree that if there are any infiltrators into the Labour Party, some of them are in the House of Lords, put there by the former Prime Minister, and that they never vote Labour when they get the chance?

The Prime Minister: I do not know whether that is a Roland for an Oliver, or a Skinner for a Taylor. I thank my hon. Friend for his helpful question, which I am sure has given a great deal of comfort elsewhere. I suggest that we have some talks about this privately. [Interruption.] We will not meet in a bedsitters, but in the House of Commons—[Interruption.] We will not meet in the House of Lords. I do not think that my hon. Friend would go there anyway.—[Interruption.] He would not go there, because he is a man of principle. Therefore, I suggest to him that we should have discussions on these matters, which are of concern to all members of the Labour Party and must be thrashed out but which only give a certain amount of childish glee to the Opposition when they are raised in this House.

Mr. Michael Latham: In view of the CBI's great interest in public expenditure, will the Prime Minister express his total support for the Chancellor's proposals to cut public expenditure, rather than leave him twisting in the wind while the Cabinet gossips to the newspapers?

The Prime Minister: I think that the hon. Gentleman will be disappointed next Wednesday, when he hears the statement.

Mr. Crawford: In the context of industrial development, will the Prime Minister inform the CBI and people in Scotland what proportion of the revenues from Scotland's oil has already been mortgaged to the IMF?

The Prime Minister: If the hon. Gentleman will put down that question to the Chancellor of the Exchequer, he will get a reply.

Mr. Kinnock: Does my right hon. Friend recall that earlier this week the CBI, in typical fashion, came forward with begging bowl in mailed fist to ask my right hon. Friend simultaneously somehow not to introduce major deflation but, on the other hand, to introduce major public spending cuts? Will he take the advice of Labour Members and, indeed, of the Labour Party, and bring about not the deflation of major spending cuts but changes of policy which will result in increases in production and investment, and again not profit those who have no interest in the real future of this country?

The Prime Minister: I take note of my hon. Friend's views. The Cabinet has reached its conclusion on the matter and it will be published in due course. What my hon. Friend said has been the subject of considerable discussion. One reason why I have not hurried these discussions to a conclusion is that they are of great importance. They go beyond even our own party interests. [Interruption.] I do not expect the Opposition to be serious about anything on these matters. I am talking not about the Opposition, but about the country generally.
What is at stake here, as my hon. Friend correctly pointed out, is the question how we can reduce public expenditure without at the same time heavily increasing unemployment or interfering with social security benefits. Frankly, these questions have engaged the Cabinet for a very long period. We shall produce what we think is the best possible result in the interests of all. I must ask my hon. Friend and the House to wait until it is published.

MR. J. GRAHAM DAY (RESIGNATION)

Mr. Biffen: Mr. Biffen (by Private Notice) asked the Secretary of State for Industry whether

he will make a statement on the resignation of Mr. J. Graham Day, Chief Executive of the Organising Committee for British Shipbuilders.

The Secretary of State for Industry (Mr. Eric G. Varley): Mr. Day has told me that, following the failure of the Aircraft and Shipbuilding Industries Bill to achieve Royal Assent in the last Session, he intends to return to Canada next year. I have learned of Mr. Day's intentions with regret, and in doing so I expressed my warm appreciation for his services.

Mr. Biffen: Is the Secretary of State aware that I, too, acknowledge Mr. Day's record of public service, particularly his service at Cammell Laird? Will he tell us whether he has had any indication that either Mr. Peter Mills or Mr. Tony Peers intends to follow the course taken by Mr. Day? Is the right hon. Gentleman aware that, should the Aircraft and Shipbuilding Industries Bill encounter a thicket of procedural difficulties in the House of Lords, it will be only and solely because the Public Bill Office pronounced it to be prima facie hybrid and because the Leader of the House and his right hon. and hon. Friends were unwilling to accept that the House of Commons should deal with the consequences of that pronouncement?

Mr. Varley: I cannot say what the intentions of other members of the Organising Committee are. As soon as it can be arranged, I shall meet the other full-time members of the Organising Committee. Perhaps that meeting will take place tomorrow.
Regarding the Bill, I think that right through this sorry situation we have been trying desperately, as was acknowledged by Mr. Day on the radio at lunchtime today, to take the only way forward. Mr. Day said:
By early action we could have assisted a restructuring and a stablisation with the minimum disruption for the individual yards and the maximum preservation of genuine job opportunities.
In saying that, Mr. Day acknowledged that nationalisation of the industry was the only way forward.
Again and again the only thing that has been demonstrated by the Opposition, and particularly by the House of Lords, has been that they do not give a fig for these industries. The only thing they


want is some kudos out of wrecking the Bill. In the process, they will wreck the industry.

Mr. Buchan: Is not this Question a piece of impertinence on the part of the Opposition? Is not the assassination to be laid directly at their door? Are they not now trying to run away from their own action? We have seen the first victim in this capacity, just as we saw 300 victims in the Stephens yard a week ago, as a result of the conspiracy between the Tory Party, the Scottish National Party and the House of Lords to wreck the Bill.

Mr. Varley: I entirely agree with my hon. Friend. Mr. Graham Day is the first casualty of the obstruction by the Opposition and the House of Lords. I hope that they are proud of what they have done.

Mr. Grylls: Is the Secretary of State aware that this resignation emphasises the perspicacity of the Opposition in raising the question of the huge amount of money which has been spent by the Organising Committee? The right hon. Gentleman said that we were responsible for this situation. He knows perfectly well, however, that he could have used the Industry Act at any time to help the shipbuilding industry. Therefore, he has no right to blame us at all. The right hon. Gentleman knows that it was the result of his own petulant and stubborn attitude in not letting the Bill go through in the last Session as amended by the House of Lords. Where will he find a new manager?

Mr. Varley: It is not for the hon. Gentleman or for the House of Lords to instruct this House on which parts of our manifesto the House of Lords should allow us to implement or not implement. The Aircraft and Shipbuilding Industries Bill had hundreds of hours of debate. On the ship repairing section we were never defeated, yet the Opposition chose to wreck the whole Bill.
Regarding expenditure by the Organising Committee, I was in the House recently when the hon. Gentleman raised these squalid little points. I think he should bear in mind that Mr. Graham Day and other members of the Organising Committee have been building up contacts both at home and abroad to get orders to

preserve jobs in British shipbuilding. That is what the Opposition have put at risk.

Mr. Loyden: Is my right hon. Friend aware that many people in the industry today will regret the statement that he has made? Workers in the industry who have been concerned about the future of the industry saw its future safeguarded only by public ownership. Their experience of private ownership in the shipbuilding and ship repairing industry has included a situation of a work force of 24,000 being reduced to 3,000 on Merseyside alone. Will he take it from me that all workers in the ship repairing and shipbuilding industry are behind him on the question of public ownership?

Hon. Members: They are not.

Mr. Varley: The fact that they are is coming through time and again in the messages that we are receiving. All the messages that we have conveyed over the last 12 months to the House and elsewhere demonstrate that nationalisation is the only answer if we are to have a coherent and viable shipbuilding industry. Those are not my words. They are Mr. Graham Day's words. The hon. Member for Oswestry (Mr. Biffen), I assume on behalf of the Opposition, has just paid tribute to that gentleman. At lunchtime today, Mr. Graham Day again said:
Nationalisation … in my opinion is the only alternative.

Several Hon. Members: Several Hon. Members rose——

Mr. Speaker: Order. This is a Private Notice Question, not a statement. I shall call one more Member from each side of the House.

Mr. Amery: Does the right hon. Gentleman deny that Mr. Day's resignation results from his own inability to convince him that the Bill would be enacted in the lifetime of this Parliament? Furthermore, looking ahead, would it not be better to forgo nationalisation of the aircraft and shipbuilding industries than to sell off and denationalise part of British Petroleum?

Mr. Varley: That does not arise out of this question and the right hon. Gentleman knows it. He still has some influence within the Conservative Party, and as a former Minister of Aviation he knows that damage has been done to


that industry and the shipbuilding industry. If he has any influence with his right hon. and hon. Friends or any influence in another place, why does he not assist us in getting the Bill on to the statute book as quickly as possible.

Mr. Heffer: Is my right hon. Friend aware that on Merseyside, particularly in the trade union movement and in the shipbuilding and repair industries, regret will be felt at the decision of Mr. Graham Day to resign? He was well thought of on Merseyside, particularly in Cammell Laird. He did a first-class job. Will my right hon. Friend make further representations to Mr. Day to reconsider his position?

Mr. Varley: I thank my hon. Friend for those remarks. Mr. Day is highly regarded throughout the industry and he has done a magnificent job. I understand his frustrations and why he was worried about the Bill getting on to the statute book. I shall consider my hon. Friend's last point. Perhaps even at this late stage we could ask Mr. Day to reconsider his position. But we should have an indication from the Opposition, particularly from the Tory Peers, that at least they will allow the Bill to get on to the statute book as quickly as possible in the new year.

Mr. Speaker: Mrs. Thatcher—Business Question.

Mr. Bagier: On a point of order, Mr. Speaker. May I humbly point out that of the Back Benchers called from this side of the House, two were from Merseyside but none was from the North-East of England where 35,000 shipworkers are employed?

Mr. Speaker: I realise that. The hon. Member could have recited other parts of the United Kingdom where shipworkers are also involved.

BUSINESS OF THE HOUSE

Mrs. Thatcher: May I ask the Leader of the House to state the business for next week?

The Lord President of Council and Leader of the House of Commons (Mr. Michael Foot): Yes, Sir. The business for next week will be as follows:
MONDAY 13TH DECEMBER—Second Reading of the Scotland and Wales Bill, which will be continued on Tuesday 14th, Wednesday 15th and concluded on Thursday 16th December.
Tuesday 14th December will be the 2nd Allotted Supply Day, when the House will be asked to agree the Civil and Defence Votes on Account and the Winter Supplementary Estimates.
At the end on Wednesday, motion relating to the 50 and 60 miles per hour (Temporary Speed Limits) Order.
At the end on Thursday, motions on EEC Documents Com(71)288 on meat, and R/1146/76 and R/105/76 on pollution of the Mediterranean and dumping of waste at sea.
FRIDAY 17TH DECEMBER—Motions on Northern Ireland Orders on Various Emergency Provisions (No. 2) and Police.
MONDAY 20TH DECEMBER—Until 7 o'clock, consideration of Private Members' motions.
Proceedings on the Consolidated Fund Bill.
I regret, Mr. Speaker, that I am not yet able to announce the date on which it will be proposed that we should rise for Christmas, though it may help the House to know that it will be suggested that we should resume on Monday 10th January.

Mrs. Thatcher: Will the Leader of the House confirm that we shall be having a statement on the IMF loan on Wednesday? Shall we have an opportunity to debate that statement before Christmas? When will the Bill for direct elections be published, as it is important that there should be a considerable interval between its publication and debate?

Mr. Foot: On the right hon. Lady's second question, I can give no date for publication but I shall bear in mind what she said. On the first question, it is proposed that the Chancellor of the Exchequer should make a statement on Wednesday. Of course there will be discussions through the usual channels about fixing a debate before the House rises for Christmas.

Mr. Ashley: Is my right hon. Friend aware that on Tuesday a junior Minister


of the Department of Education and Science made a remarkable and inaccurate statement to the House when he said that there was no evidence of a wave of vandalism? Is my right hon. Friend aware that I have already sent overwhelming evidence to the Home Secretary that the current wave of vandalism is costing over £100 million a year? Is he aware of evidence that vandalism is causing grave concern to the old and disabled? May we have a debate on this important issue next week.

Mr. Foot: I cannot accept what my hon. Friend said in criticism of my hon. Friend the Minister until I have had an opportunity of looking at the details of his claim. I cannot promise him a debate next week, but it is a subject which should be debated on some future occasion. It is possible that the Consolidated Fund debate will provide an opportunity to raise the issue.

Mr. Beith: On which days do the Government propose to put forward their spokesmen for Scotland and Wales during the devolution debate? If the House knew that, hon. Members would be able to decide whether they wished to follow the Government in their allocation of days to the different parts of the Bill. I thank the Leader of the House for allowing four days for the debate, which is the time we requested. It will be beneficial because it will enable a wide range of Conservatives to be called to express a wide range of opinion.

Mr. Foot: I thank the hon. Member for his suggestion. It will be of help to indicate to the House the spokesmen whom we intend to speak for the Government, subject to their catching your eye, Mr. Speaker. The Prime Minister will open the debate on Monday. The Secretary of State for Scotland will speak on Tuesday and the Secretary of State for Wales on Wednesday. On the final day of the debate my hon. Friend the Minister of State will begin the debate and I shall wind up the debate. It is not proposed that speakers from the Government Benches will wind up the debate on Monday, Tuesday or Wednesday. That will leave more time for Back Benchers. We propose to extend the debate on Monday until 12 o'clock and, to make a longer extension, if the House

desires it, on Tuesday. I hope that there will be plenty of opportunity for all opinions to be expressed.

Mr. Ogden: Will my right hon. Friend confirm that the devolution debate cannot be a strictly Scottish or Welsh matter and that English hon. Members will want to have their say. Is he aware that the Government today published the consultative document "Devolution: the English Dimension"? It states that devolution for Scotland and Wales is good and will not harm the unity of the United Kingdom but that the establishment of an English Assembly would be a threat to the security of the State. How does he reconcile that? When can we discuss this document, which is no less important than the proposals for devolution for Scotland and Wales?

Mr. Foot: The document which has been published today says nothing of the kind. I am sure that when my hon. Friend has had time to study it he will see that it does not make the remarks about devolution for England that he suggests. Subject to Mr. Speaker's ruling, references to the document will be in order during the general Second Reading debate, which will cover the whole question of devolution and its effect on the United Kingdom. Anyone who reads the first clause of the Bill will see that it refers to the unity of the United Kingdom.

Mr. Ogden: On a point of order, Mr. Speaker. I accept being called a liar by a few people, including my right hon. Friend, but I was referring to paragraph 15 which states:
The Government firmly believe, however, that establishing such an assembly for England could damage the structure of the United Kingdom".
Damage to the structure of the United Kingdom would constitute a threat to the security of the State.

Mr. Speaker: What was the hon. Member's point of order?

Mr. Ogden: My point of order was that only from my right hon. Friend will I accept being called a liar.

Mr. Foot: In no circumstances would I call my hon. Friend a liar. I was not suggesting that, and I was not calling him a liar. I did not use the word. If my hon. Friend studies the document further he


will see that his original remarks are not justified. He will find references to an English Assembly—an Assembly which we believe will have the consequences there described. When he examines the whole document he will see that that is the case.

Mr. David Price: Reverting to the Second Reading debate on the Scotland and Wales Bill, may I ask the right hon. Gentleman whether he has seen Early-Day Motion No. 36?
[That this House believes that during the Second Reading of the Scotland and Wales Bill all Front Bench speeches should be limited to 30 minutes and all Back-Bench speeches limited to 10 minutes; that Back-Bench Privy Councillors should be accorded no priority and that the alternation of speakers to be called in the debate should be on the basis of support for, or opposition to, the Bill rather than on the normal basis of party allegiance.]
Is the right hon. Gentleman aware that in that motion my hon. Friends and I suggest that Front Bench speeches be limited to half an hour and Back Bench speeches to 10 minutes? Is it not quite clear that a large number of right hon. and hon. Members will wish to take part in the debate and that the occupant of the Chair will have a difficult job if speeches are longer than I propose?

Mr. Foot: The question of who is called in the debate is a matter for Mr. Speaker. It would not be possible for the Government to introduce proposals for limiting the length of speeches. That is obviously a matter which only the whole House should decide. Speaking as one who has spent most of his time on the Back Benches, I believe that a limitation on the length of speeches can be a greater infringement of the rights of Back Benchers than any other proposal. Certainly many distinguished Back Benchers of the past would never have been able to put their case against Administrations—for instance, Sir Winston Churchill in the 1930s—if they had been limited to 10 minutes. I hope that the House will not press that proposal.

Mr. Mellish: Does my right hon. Friend realise that some of us, humble Englishmen, are pretty sick at the thought

of four days next week being spent debating Scotland and Wales? Since we are to have a massive spate of this legislation next year, may I ask my right hon. Friend whether he can devise a way in which nothing else will be said about Scotland and Wales except in some obscure Committee away from the Floor of the House? Is he aware that I am sick to death of doing nothing else but talking about that lot?

Mr. Foot: The Bill will be before the House next week and it will be discussed when we return after Christmas. It is not only a Bill about Scotland and Wales it is also a Bill about sustaining the unity and the economic strength of the United Kingdom. It is a Bill which can greatly contribute to the welfare of this country in the years to come. It is unwise, even of my right hon. Friend, to try to pour scorn upon it.

Mr. Tebbit: Would the right hon. Gentleman like to explain to the hon. Member for Berwick-upon-Tweed (Mr. Beith) that it is due to the co-operation of the Opposition, in allowing the use of a Supply Day, that there are to be four days for the debate next week rather than three? Can the right hon. Gentleman say whether it is due to some sort of shambles in the Government's legislative programme that he does not know when we shall rise for Christmas or is it because of some other act of God, like all the others which have afflicted this Government?

Mr. Foot: One extra day is provided, as the hon. Member has said, by the Opposition. We have supplied some extra time for the debate and I believe that the proposals we have made for limiting the number of Front Bench speeches can help to ensure that many more Back Benchers will be able to contribute. The reason we have not announced today when the House will rise next week is that we are committed to have discussions, as I said, with the Opposition about the debate which may take place next week on the statement to be made by the Chancellor.

Mr. Jay: As the Government are now laying an Import Duties Order which would raise still further—on 1st January—a number of taxes on food and thereby the cost of living, can my right


hon. Friend assure us that this order will be debated before it comes into effect, so that Back Benchers can express an opinion on it?

Mr. Foot: I cannot give my right hon. Friend a guarantee that we can have a debate beforehand. As I said last week, however, this is a subject that can be raised in general debates.

Mr. Nicholas Winterton: The Lord President has said that we shall return after the Christmas Recess on 10th January and implied that we shall break up not before 23rd December. Is the right hon. Gentleman aware that this will be the shortest Christmas Recess in the history of this House? Is he further aware that this creates tremendous difficulties for hon. Members with families? Does he realise that it causes further problems in that it is difficult for hon. Members to undertake constituency engagements? Finally, does he realise that this House and the country are sick of legislation? Can we have a break from that?

Mr. Foot: I am sure that hon. Members in all parts of the House would, for perfectly legitimate reasons, like to have longer recesses. It is also the fact that this House has very important business to transact and that we have to get on with it.

Mr. Ioan Evans: Reverting to the devolution debate, may I ask my right hon. Friend whether, next week, we shall have a statement on the Government's intentions about holding a referendum?

Mr. Foot: I cannot say that there will be a Government statement on the matter. Obviously this will be subject to debate.

Mr. Forman: In view of the long-term significance of a decision on the future of nuclear power, may I ask the right hon. Gentleman whether he is prepared to see that time is made available for a full debate on the subject in the near future?

Mr. Foot: I cannot promise an immediate debate on the subject but I do recognise its importance. We shall see whether we can arrange a debate at some stage or whether there is some other opportunity for this issue to be raised. There will be some opportunities—I am

not saying that this fulfils all that the hon. Gentleman would wish—for debate during the proceedings on the Consolidated Fund next week.

Mr. Greville Janner: In view of the rare and treasured agreement between the TUC and the CBI on the vital necessity of implementing the proposed health and safety regulations concerning safety committees and safety representatives, which could save so many lives, and in view of my right hon. Friend's efforts over the years in this direction, may I ask him at least to promise that the regulations will be laid before Parliament before the House rises and that we shall have a debate on the matter as soon as possible thereafter?

Mr. Foot: I cannot say when the regulations will be laid or when we shall have the debate. I recognise the importance of these regulations and I will convey what my hon. and learned Friend has said to my right hon. Friend the Secretary of State for Employment.

Dr. Hampson: Is the right hon. Gentleman aware that this month sees the second anniversary of the Bullock Report? Since the Prime Minister has belatedly recognised the country's concern over standards of literacy, may I ask him how he justifies the Government's failure to provide time to debate this important report?

Mr. Foot: I fully recognise that this is an important subject. There are several reports which the House would wish to debate, the Bullock Report among them. We have a very crowded agenda. As I have had to say to other hon. Members, we have had to abbreviate the length of the Recess so that we can debate these matters. I would add that this is a subject which individual Members can raise at other times.

Mr. Watt: Will the Leader of the House recognise that the statement made by the right hon. Member for Bermondsey (Mr. Mellish) contained a great deal of truth? Is he aware that the sooner there is devolution of power to Scotland the sooner will there be more time available in this House for the sort of business which the right hon. Member wishes to be discussed here?

Mr. Foot: That is one of the most eloquent appeals the hon. Gentleman has ever made.

Mr. Buchan: May I refer to the answer my right hon. Friend gave earlier on the issue of the devolution referendum? Is it not imperative that this issue is dealt with before we have the debate on the Second Reading of the Bill? Does my right hon. Friend appreciate that the approach of several Members will be different if we are told that there is to be a referendum, at the end of the debate, on the two issues of devolution and separation of power to Scotland?
Does my right hon. Friend recall that during business questions last week I asked him to consider making a statement about the Shetlands in view of its forthright declaration that oil revenues gained from the oil in Shetland waters belonged as of right to the people of the United Kingdom? Is he aware that this will clearly alter the complexion of some of the contributions that may be made from one of the Opposition parties?

Mr. Foot: My hon. Friend will have heard the answer given by the Prime Minister a few minutes ago on the Shetland issue, saying that he will be sending a reply to the Shetland Council on this subject very soon. I fully accept what my hon. Friend has said about the importance of the referendum. No one in the House has pressed me more strongly than my hon. Friend on this point. I cannot say any more now. Obviously the matter will enter into debate and the Government will have to comment on the debate.

Sir David Renton: Since the right hon. Gentleman's consultative document on the English dimension makes it clear that the devolution proposals for Scotland and Wales and any proposals for England necessarily impinge upon each other, may I ask the right hon. Gentleman to heed the plea already made for a debate on his consultative document as soon as possible after we return from the Christmas Recess, perhaps before we settle down to the Committee stage on the Scotland and Wales Bill? Will the right hon. Gentleman give an undertaking that in the course of that debate the Government will announce their provisional conclusions for England so that there may be credibility about the points of view they express in relation to Scotland and Wales?

Mr. Foot: I repeat that, subject to any ruling by you, Mr. Speaker, references—extensive, I would have thought

—to the consultative document about England are bound to be in order in the four-day debate because Clause 1 of the Bill refers to the unity of the United Kingdom, and that obviously embraces many of the matters covered in the consultative document. The very purpose of the Government's issuing a consultative document is to invite a response from those throughout the country who will be receiving it and will be able to make their views known. I do not think that it would be wise or intelligent for the Government to prejudice that in advance, and that is precisely the reasoning behind the way in which we have issued the document, as I think the right hon. and learned Gentleman will see when he reads it.

Mr. Andrew F. Bennett: Will my right hon. Friend give careful consideration to ending the present Session on 10th or 11th January, thereby enabling the Aircraft and Shipbuilding Industries Bill to be brought into force? If the Government did that, would it not result in only a small delay in other Government business, a small price to pay, and would not a new Session from January to 6th December be logical?

Mr. Foot: I saw the suggestion in the Daily Mail that something of the sort is being considered by the Government. I have to say that nothing of the sort is being considered by the Government. If we did proceed in that way, we would lose the advantage of a great deal of the business that we have already transacted, and it would not be right to treat the House in that manner. I cannot accept that proposal. The Government have never considered that way of dealing with the situation.

Mr. Baker: If, during next week, the Bullock Committee on Industrial Democracy reports, will the right hon. Gentleman undertake to set up a Select Committee of this House to consider it, since the Government have said that they wish all representations to be made, and there would be no more appropriate body than a Select Committee to receive those representations on an issue on which both sides of industry are divided between themselves?

Mr. Foot: I think that we should see what the Bullock Committee reports before we pass judgment on it. In any


case, it would be a peculiar method for the Government and the House to proceed to appoint a Select Committee to examine another committee's report which had just been brought forward.
I believe, however, that there is some urgency about the question of proceeding with proposals for industrial democracy. There was a Private Members' Bill on the subject which was discussed extensively, and one of the pleas made to the Government then, certainly by many of my hon. Friends who have great knowledge of industrial democracy, was that we should go ahead as fast as possible with these ideas. We want to proceed with as much speed as we reasonably can. Therefore, I cannot suggest a Select Committee to deal with it. I think that the House must give its views on the matter, but we should consider first what the Bullock Committee proposes and see how fast we can work towards that.

Mr. Kinnock: Coyness is not a characteristic that we associate generally with my right hon. Friend, but he is being uncharacteristically coy in response to requests for a referendum so that the real feelings of the people of Scotland and Wales can be known on this irreversible constitutional issue. Is my right hon. Friend aware that, unless there is something more than a vague and reluctant half-promise about considering a referendum, a large number of us on this side of the House will have great difficulty in assisting the Government in the passage of the Bill?

Mr. Foot: Certainly no one has ever accused my hon. Friend the Member for Bedwellty (Mr. Kinnock) of coyness on this or any other topic, and I do not think that that day is likely to come. I think that he should wait and see what is said in the debate.
I acknowledge that there is a strong case for a referendum, and the motion on the Notice Paper standing in the names of many of my right hon. and hon. Friends underlines that fact. Of course the Government must treat seriously what is proposed in that motion. But I ask my hon. Friend to await what is said in the debate, and since he asked me not to be coy on the subject of devolution, I hope that he will not get into such a situation that he ends up with the CBI

in making its representations, because I am sure that that would be an inhibiting position for him.

Mr. Kinnock: Are you with the right hon. Member for Sidcup (Mr. Heath)?

Mr. Foot: I hope that there is a sharp gulf between them on the matter.

Mr. Eldon Griffiths: Is the right hon. Gentleman aware that many of us believe that the issue of direct elections to the European Parliament is more important and is more likely to command a much larger all-party majority in this House than the devolution issue? Will he bring forward the Second Reading of the Bill for direct elections as quickly as possible after the House returns from the recess?
Secondly, devolution is a matter of the future of the United Kingdom, including England, and it is quite intolerable that we should have received only today a complicated document on the subject of England, only a matter of days before there is to be a debate not just on Scotland and Wales but on the future of the whole of the United Kingdom, including the English.

Mr. Foot: I cannot accept the hon. Gentleman's order of priorities in relation to direct elections and the devolution Bill, but I replied to the Leader of the Opposition on the matter earlier.
I think that if the hon. Gentleman gets the consultative document on England, starts reading it now and works hard over the weekend, he will be qualified to understand it by Monday or Tuesday, at any rate by Thursday. We have done what we promised to do—to produce this document in time for hon. Members to have a chance of studying it first. I do not believe that it is so complicated that the hon. Gentleman will not be able to comprehend it.

Mr. Eldon Griffiths: On a point of order, Mr. Speaker. I was provided early this morning by a member of the Press with the document on England. When I came to the House, I asked for the document and was told that I could not receive it as a Member of Parliament until this afternoon. I think that that is an unacceptable position, and the right hon. Gentleman should recognise it.

Mr. Foot: Further to that point of order, Mr. Speaker. We have issued this document in the normal fashion. If the hon. Gentleman has been given a copy by the Press in the circumstances he has described—and I am sure that he is telling the truth—that is a breach of the normal arrangements.

Mr. William Hamilton: The debate next week would be much more interesting and much more fascinating if we had a completely free vote on both sides of the House. Will my right hon. Friend not set an example to the Opposition by announcing that we on this side at any rate will have a free vote? In view of his well-known opposition to the imposition of guillotines on constitutional Bills, will he give an assurance at this stage that in no circumstances will he seek to impose a guillotine on the Scotland and Wales Bill?

Mr. Foot: My hon. Friend has put the question to me about a free vote on earlier occasions, but he knows that the proposals included in the Scotland and Wales Bill have figured in all the Labour Party declarations that we have presented to the country, both at election time and at our conferences. He also knows very well what are the ways in which the Government give backing to a measure of this character. We could not accept his suggestion for dealing with it next week.
My hon. Friend also asked for an assurance that in no circumstances will there be a guillotine. I could not give the undertaking for which he asks. I think that we shall see how we must consider what is the proposition. We shall see how we proceed. It is the Government's intention that there shall be plenty of time to discuss the Bill but also that we shall get it on to the statute book.

Mr. Speaker: There are three hon. Members—

Several hon. Members: Several hon. Membersrose—

Mr. Speaker: I thought that there were only three hon. Members remaining. We obviously cannot go on with Business question all day. I proposed to call another four questions.

Mr. Johnson Smith: I revert to the Lord President's reply to the request by my hon. Friend the Member

for Carshalton (Mr. Forman) for a debate on nuclear energy. Is the Lord President aware that the Flowers Report on Nuclear Energy is one of the most disturbing and important documents to be published since the war? Would the right hon. Gentleman not agree that to suggest that a debate might be raised in Consolidated Fund Bill time does not do justice to the significance of that report? Would he kindly reconsider the possibility of holding at least a one-day debate on this subject early in the new year?

Mr. Foot: I would agree with what the hon. Gentleman said about the importance of the subject, but during my time in this House I have heard many important subjects discussed on Consolidated Fund Bill days. I do not think that my suggestion should be ruled out on that account. However. I am not saying that there is no possibility of providing some further time. I am merely suggesting that this is one of the ways in which the matter could be raised.

Mr. Heffer: Will my right hon. Friend consider taking the Bill for devolution in Scotland and Wales off the agenda in view of the fact that it says that it will
provide for changes in the government of Scotland and Wales"?
Is the Lord President aware that in certain places the Bill involves itself in English government? For example, it says that three Members shall be appointed from the Welsh Assembly to the Severn-Trent Water Authority, which very much involves England. On that basis it seems that the Long Title is wrong because it is not purely concerned with "Scotland and Wales". Under those circumstances, would my right hon. Friend not reconsider the Bill and take it back until it is put right?

Mr. Foot: All these are debating questions. I feel sure that my hon. Friend may seek to intervene over the coming weeks on this subject.

Mr. Heffer: I certainly shall.

Mr. Foot: I had a feeling that that might occur and that nothing I may say would dissuade my hon. Friend. These are matters for debate. As I said earlier, this is certainly not a Bill solely concerned with the interests of Scotland and Wales. It is concerned with the interests of the United Kingdom as a whole.

Mr. Ian Lloyd: Since provision of the facilities which the Committee has discussed may well have far-reaching effects on the work of the House as a whole, and apart from that a benign effect on the balance which the House spends in Session and recess, will the Leader of the House give us an early opportunity of discussing the joint report of both Houses on the provision of computer facilities?

Mr. Foot: I do not know whether we can discuss it today but we have had some consideration on the subject by the Services Committee. I have no doubt that the Services Committee will consider how best its report can be made to the House.

Several Hon. Members: Several Hon. Members rose—

Mr. Speaker: Order. If they are brief, I shall call the three remaining hon. Members.

Mr. Rost: Does the Leader of the House recognise that his answer with regard to the Flowers Royal Commission Report on Nuclear Power and the Environment is unsatisfactory? Would he not accept that this matter carries far more long-term important implications for the future of this country than anything else which has been discussed in the House this afternoon—certainly more so than devolution? It is quite unsatisfactory for the Leader of the House to attempt to relegate this important Royal Commission Report to some Adjournment debate in the middle of the night. The Government have a responsibility to respond to this report and should provide a debate in this House.

Mr. Foot: I am in no way depreciating the importance of the subject nor am I seeking to relegate it. It is often possible for hon. Members who feel strongly on particular subjects to raise them on the Consolidated Fund Bill. Often debates of this nature can lead to further debates later. There are many opportunities for Back Benchers and others to raise matters in this House. It would not be wise to say that matters raised on the Consolidated Fund Bill should be confined to those which are regarded as secondary.

Mr. Cormack: In view of the crucial importance of what the Chancellor of the Exchequer will say next Wednesday, would it not be a good idea, and also give us a slightly less gloomy Christmas, if we debated the economy next Wednesday

and Thursday and waited until after Christmas to debate devolution?

Mr. Foot: No. What we have suggested is the best way of proceeding. I have had no notice of opposition from the official Opposition on the subject and we have to take account of their views as well as those of the hon. Gentleman.

Mr. Luce: Is the House so choked with legislation that the Leader of the House cannot find time to debate foreign affairs?

Mr. Foot: No doubt there will be opportunities to discuss foreign affairs. Many aspects of foreign affairs are discussed by the House and some will be discussed on the Consolidated Fund Bill. There are many opportunities for the matter to be raised. They can be raised elsewhere in various other debates, but we shall see what the chances are later.

CONSOLIDATED FUND BILL (DEBATE)

Mr. Speaker: For the debate on Monday 20th December on the Second Reading of the Consolidated Fund Bill, hon. Members may hand in to my office by 9 o'clock on the morning of Friday 17th December their names and the topics they wish to raise. The ballot will be carried out as on the last occasion. An hon. Member may hand in only his own name and one topic.
The Consolidated Fund Bill includes the Defence and Civil Votes on Account for 1977–78 presented in House of Commons Papers Nos. 6 and 7 and the Supplementary Estimates for 1976–77 presented in House of Commons Papers Nos. 8, 9 and 10. It will be in order on Second Reading of the Bill to raise topics falling within the ambit of the expenditure proposed in these papers.
I shall put out the result of the ballot later on 17th December.

BUSINESS OF THE HOUSE

Ordered,
That, at this day's sitting, Standing Order No. 3 shall apply to the Motion relating to the Appropriation (No. 3) (Northern Ireland) Order 1976 with the substitution of half-past Twelve o'clock or two and a half hours after it has been entered upon, whichever is the later, for the provisions in paragraph (b) of the Standing Order.—[Mr. Frank R. White.]

Orders of the Day — SUPPLY

[1ST ALLOTTED DAY]—Considered.

Orders of the Day — PUBLIC ACCOUNTS

4.17 p.m.

Mr. Edward du Cann: I beg to move,
That this House takes note of the First, Second, Third, Fourth, Fifth and Sixth Reports from the Committee of Public Accounts in the last Session of Parliament and of the Treasury Minute and Northern Ireland Memorandum on those Reports (Command Papers Nos. 6654 and 6653).
My second happy duty on behalf of the Committee is to render our thanks, and no doubt those of the House as a whole, to the Clerk for his imperturbable conscientiousness and to the Treasury witnesses, of whom the principal is Mr. McKean, for their valuable co-operation. I am sure that I carry the House when I say that the Treasury and the Public Accounts Committee are, and always should be, natural allies. I also thank the present Comptroller and Auditor General, Sir Douglas Henley and Mr. Sykes, who are most willing and able servants and guides to the Committee. If there is merit in the Committee's work, much of the credit should be theirs, and also that of their staffs, on whose skills we so much rely.
By no means least, I wish to express my own gratitude and, I am sure again that of the House to my fellow Committee members. They have gone through a heavy programme of work. The six reports have dealt with no fewer than 43 main subjects and the work was completed this year before the Summer Recess. I have to thank them for their conscientiousness. I have much admired their incisive questioning of witnesses. By no means least, I must thank them for their personal support and their many kindnesses to me.
As in former years, the Committee has carried out its work in an entirely nonparty spirit, even when politically contentious subjects have been examined. Whatever divisive views there have been on the Floor of the House, in Committee

we united in our aim to contribute to the better management of the country's resources. Heaven knows, that is an aim which determinedly needs to be pursued.
The House may like to know that in our probings of the quality of departmental administration we had no difficulty in agreeing on the terms of all our reports, without any division in the Committee formal or informal. Right hon. and hon. Gentlemen will therefore understand if I say, perhaps in parenthese but none the less with emphases, how proud I am to be the Chairman of the oldest and most senior of the Select Committees. It is indeed a very pleasant duty.
I told the House in last Session's debate how the Committee had made progress in publishing reports at shorter intervals, so that the volumes would be smaller and, I hope, easier to digest. We made a little more progress during the past Session by publishing four main reports instead of the three main reports made in the previous Session. I hope that it will be possible to improve again on this performance during the coming Session.
This depends exclusively on the competence of the printing facility that is available to us. I wish to record the Committee's dissatisfaction with the present position. I propose to raise the matter with the Leader of the House. In my opinion, the competence of the printing facilities available to the House in terms of punctuality has been unsatisfactory for some time. I believe that the House would do well to insist that its business, including that of its Select Committees, be expedited and not impeded in any way by the services available to it. There should be neither carelessness nor delay at any moment in the pursuit and service of democracy as represented by this House.
I want to mention some of the particular issues raised in our work last Session. Our First and Second Reports deal, as usual, with cases of excess expenditure in Great Britain and Northern Ireland, respectively. The Committee, supported by the Treasury in this respect, as in many others, has always encouraged taut estimating as a help to sound financial discipline. I suppose that from a purely statistical point of view, if one tries conscientiously to get as near as


possible to the eventual outturn, in 50 per cent. of the cases one will have a shortfall and in 50 per cent. an excess. I do not advocate quite that approach; but when minor excesses are incurred which are constitutionally wrong but for which no one can be held culpable, the Committee imputes no blame.
Last year, although we reported to the House that we saw no objection to the sums needed being provided by Excess Votes, we voiced our concern about accounting failures and thus an apparent lack of expenditure control in the Home Office in recent years. We were assured that further steps had been taken to ensure adequate financial control in the future. We shall be watching closely to see whether those hopes are fulfilled.
Our Third, Fifth and Sixth Reports record the greatest part of our work arising from our formal duty of examining the accounts laid before the House. Our examination concentrated, as usual, on questioning departmental accounting officers and their senior staffs on subjects that had been drawn to the attention of Parliament in the reports of the Comptroller and Auditor General on the 1974–75 Accounts, and on subjects on which we were following up the comments in the Treasury Minutes on the Committee's reports in the 1974–75 parliamentary Session.
In parentheses, again I emphasise to the House that continuity of survey strikes the Committee as an important need. I hope that the House will endorse that approach.
The contents tables in the reports show again what a wide variety of subjects was examined. As I have said, we thought it necessary to report on over 40 subjects altogether. However, I ought to say at once, and not least because I have made some astringent public comments on certain matters, that not all these reports were critical of departmental administration. The PAC is so firmly established as an inquisition that it must be a gratifying surprise when it is able to report that it has no criticisms to make of particular transactions that it has examined. The Department of Energy's special purchase of crude oil from Iran was one example. Another that I could add is

that after examining the Public Trustee on the administration of his relatively small but interesting office, we were able to express a warm welcome for the considerable staffing and other economies that he had made and for his further plans for improving office efficiency. I hope that other Departments will follow that sensible example.
If the Committee is critical, it is, I hope, always constructive. If it is searching, I hope that it is also fair. If complaints must be made, we shall make them, as is our responsibility and duty, plainly and clearly. But the Committee is happy also to praise, if that is justified. I do not think that anyone, especially a superficial observer writing, let us say, about the work of this House, should suppose that because our reports are usually overwhelmingly critical, all Government administration, or even the major part, is incompetent. That would be a foolish and an inaccurate deduction. Our responsibility is to put a magnifier on the minority of failures, actual or potential. It has seemed to me sometimes that we are looking always at the tip rather than at the bulk of the iceberg.
I go on with particular matters. The necessity for economies in the Civil Service and other public sector staffing looms large in the minds of all of us in the House—well, nearly all of us, perhaps. I am sure that it will continue to do so and I am certain that it should. The Committee is always conscious of it, though it is an elusive objective, and sometimes I think that it needs pursuing with blunt instruments. However, the House must understand that it cannot have more administration, as a result of more tasks being placed upon public servants, without adding still further to the number of administrators, unless greater administrative efficiency can be achieved. As the Financial Secretary to the Treasury pointed out in last year's debate, in the context of the cost of effort devoted to combating tax evasion, this is a question of deciding where the balance needs to be struck.
This is particularly brought home to us when we look at the tax collecting functions of the Customs and Excise and Inland Revenue Departments. The Customs and Excise Department, for which I had some happy responsibility as


a Treasury Minister some years ago, told the Committee—this seemed at first sight to be a shocking admission—that it was failing to collect about £30 million in value added tax each year. It then went on to say that it would need to spend an exra £25 million on staff to recover it.
The Inland Revenue told the Committee that as increasingly large numbers of higher-rate income tax payers, whose affairs are necessarily complex—as the affairs of all of us seem to be these days—are brought within the net, a disproportionately large number of staff had to be employed. It forecast that during the two years from April 1975 to March 1977, numbers employed in the Inland Revenue would increase from 74,000 to 90,000—an increase of more than 20 per cent.—if there were no changes made in tax allowances. That prospect speaks for itself.
Following the cuts in the rate support grant, which we shall be debating shortly—and how difficult they will make life for local authorities—and the consequent worries for the local authority administrations, many of us in the House are perhaps becoming more aware than previously of the huge burdens which legislation that we have passed in this House has imposed upon them. It seemed to me appropriate, in the context that I have already mentioned, of which I have given two examples, that I ought to give a word of warning to the House.
The problems that local authorities have at present and the problems of the Customs and Excise and Inland Revenue are just three examples of the need for a more careful counting of the cost of legislation in this House before we enact it. In my view, we have been much too careless in past years in that respect.
I have one minor proposal to make on behalf of the Committee which I hope will be of assistance to the House in this regard. The PAC has recommended, and the Treasury has accepted, that when Finance Bills are presented to the House in future the staffing implications of taxation proposals should be brought to the notice of Members of Parliament at the same time.
I have a further recommendation of my own to make, namely, that the Treasury should instruct the Inland Revenue and the Customs and Excise to discover and

to publish comparative statistics for all the developed countries, including the United Kingdom, showing the numbers employed for revenue collection and the amount of revenue collected, the cost per pound of revenue, and so on. The reason for making that suggestion is that, in my opinion, much of our modern taxation legislation is unnecessarily complicated and, therefore, unnecessarily expensive.
I dare say that that remark applies to other facilities of government, and I believe that the House would do well to make a start on examining this particular matter. Indeed, I wish that Governments would take as a maxim for all future action and legislation that simplification should be the norm and the ambition.
Your Committee was also much concerned about the very large increases in costs of the Manpower Services Commission. A 37 per cent. increase in staff from 33,000 in January 1974 to 46,000 in May 1976 was—I quote from the Sixth Report—attributed mainly to
higher unemployment and expansion of the training programme".
However, there was also an increase in general administrative services.
Nor were we in the Committee clear about the real advantages of substituting for the old employment exchanges, perhaps in the back streets of towns and cities, over 1,000 brand-new and garish jobcentres in expensive High Street locations. The expenditure here increased from under £100 million a year, two years ago, to more than £400 million in the next financial year. That seemed to me and to the Committee to be a very large increase indeed.
We have therefore recommended that the Commission should urgently develop
realistic criteria against which the cost-effectiveness of the present expansion programme can be determined.
It is not just a matter of being frightened by those figures that I have detailed—the huge increase in staff and the huge increase in cost, seemingly without a proper examination of its value. When we examined the work of the Professional and Executive Recruitment Service, for example, we were far from convinced that in 1975–76 a placing of one candidate per office for each working day represented good value for money. I am sure that I speak for all members


of the Committee in saying that we strongly support all worthwhile efforts to improve skills and training and to place people in jobs, but that makes it surely all the more essential to do it economically and not to equate greater expenditure and bigger staffs with a more effective effort.

Mr. W. R. Rees-Davies: Did my right hon. Friend's Committee take into account that there is a very large number of private agencies which are able to place professional and executive people in adequate and proper jobs without the need for any public assistance from the Manpower Services Commission?

Mr. du Cann: Yes, we took that into account. This is one reason why it would be reasonable for me to say that we shall look forward to seeing the results of the surveys that the Manpower Services Commission is now undertaking. We shall discuss the subject with the Commission further and report again to the House.
Another major field of our examination was the varied and rapidly expanding one of assistance to industry. This includes assistance to the shipbuilding industry—the Fifth Report refers—where we considered assistance to Govan Shipbuilders Limited and Cammell Laird Shipbuilders Limited and the financial consequences of what appears to be almost open-ended support, although the Department of Industry reaffirmed that the assistance was not open-ended.
The House should be made aware that the figures are very large—in the case of Cammell Laird Shipbuilders Limited about £40 million and in the case of Govan Shipbuilders Limited about £60 million. When such huge sums of taxpayers' money are involved, it is no pleasure to record, as the Committee felt bound to record, that productivity in the Govan shipyard at any rate had not grown—if anything, it had fallen—and that the losses were greater than expected.
When large amounts of public money are voted by the House for the support of industry, it is reasonable in return that the House should expect the highest possible standards of commercial performance. Nevertheless, all of us in the House

are aware of the current difficulties for our shipbuilding industry and of the urgent need for a realistic and comprehensive strategy for it. I am glad to see that the Treasury Minute recognises this, but I think that it would be better if that strategy could be established sooner rather than later.
Your Committee also examined the Department of Industry's new criteria for selective assistance to industry. I should like to think that it was probing by the Public Accounts Committee that led to the establishment of these new and wiser criteria. We welcome these criteria, in contrast to some earlier experiences. We welcome them as a constructive approach to the development of sound and businesslike procedures. We endorse the broad philosophy that selective assistance should invest in success and potential success, and should not just prop up failure.
We looked at several examples of the way in which assistance had been given but where the results had been, predictably, I would say, disappointing—Kearney and Trecker Marwin Limited, a machine tool manufacturer, and the three worker co-operatives—the Meriden Motorcycle Co-operative, Kirkby Manufacturing and Engineering Company Limited and the ill-fated Scottish Daily News, where we were especially sorry to see that the workers themselves seem likely to lose substantial sums which they have subscribed privately. That was something that the Committee greatly regretted.
I happen to be, and have always declared myself to be, a supporter of the idea of workers' co-operatives. It has seemed to me, if I may state a personal view, doubly important that these early essays in this interesting field of sociological experiment should be well conceived if the idea is to prosper and survive. I believe that those who force those ideas forward without proper examination of the financial and other considerations do themselves and the workers they purport to serve a disservice by so doing.
We voiced our concern about the need for proper parliamentary accountability for the large public funds under the management, direct and indirect, of the National Enterprise Board, established in November 1975 and now responsible


for the oversight of the activities of British Leyland and Rolls-Royce (1971) Limited, among other enterprises. We shall no doubt be looking further into that matter in the coming Session.
I think I should say this to the House on behalf of the Committee in regard to that matter. Again, huge sums are involved. At the minute there is no proper, recognised and understood, and clearly defined method by which full parliamentary scrutiny of the affairs of the National Enterprise Board can take place. That is not right. This, I believe, is a task for the Public Accounts Committee, and I think we would do well on behalf of the House as a whole to insist on developing a modus operandi.
To be fair, I should say that I have had the opportunity to discuss this point with the Secretary of State for Industry, who could not have been more sympathetic or more alive to the problem. He has offered every co-operation in that regard. I appreciated that, and so will the Committee.
Now to another matter, again involving large sums. Your Committee again spent some time in examining the effectiveness of purchasing arrangements in large capital projects where problems seem to recur with unwelcome familiarity. I have no doubt that various members of the Committee will want to comment on some of these individual matters and I will not take up too much time with them therefore.
I should like to mention the case of the RARDEN gun, which is dealt with in the Third Report. It is no doubt by now an excellent weapon, but substantial losses ensued in respect of this weapon from starting production before satisfactory development had been achieved. This is a perennial feature of defence projects and, in the view of the Committee, is inexcusable.
In the same way, the major projects of introducing a new class of destroyer—the Sea Dart Type 42—and a new class of frigate—the Type 21—ran into exceptional dislocation when construction was started on the basis of incomplete designs, resulting in serious additional costs. Then there was the additional complication of continual variations in order as the work proceeded. All this is referred to in the Fifth Report.
The House will understand that, because of my interest in maritime affairs, it causes me particular disappointment again to record that the purchasing authorities of the Navy are by no means as competent as they should be. We are talking about delays of up to two years in deliveries of these ships. To take one matter of detail, the cost of one ship—HMS "Sheffield"—increased during this process by no less than 59 per cent.
As the Committee emphasised in its report, the tragedy of all this is that it is the Services themselves which are ultimately the main sufferers, because higher costs must adversely affect the scale and timeliness of re-equipment programmes if the overall defence budget is necessarily limited. When money for defence is as short as it seems to be today, there is all the more duty upon the Service Departments to see that what money is available is effectively and not carelessly spent.
In this last Session, as in the previous year 1974–75, we examined some major computer projects, this time in the National Health Service and in other areas. In the National Health Service an experimental programme had been planned for exploring computer usage in hospitals. This is referred to in the Sixth Report. This again showed shortcomings in carrying out feasibility studies and in the preparation of reliable cost estimates.
The exact objectives of each experiment were not always clearly determined from the outset. It seems a remarkable idea to start out on a voyage without clearly knowing where one intends to go. There seems to be something socially OK about having a computer—"Let us have a computer. Never mind what we shall do with it. Let us have one." Nor is it only that. We found that results were not always adequately monitored during progress, and as a result various projects had to be terminated and others modified, without very much so far achieved in return for nearly £7 million spent.
We sincerely hope that these fairly elementary lessons have now finally been learned, or, as the Treasury Minute says, in its unflamboyant style, they will be taken into account in future planning.


In other words, let us hope that such mistakes do not occur again.
The Committee expressed concern also about the need to report critically on a whole range of health matters in successive years. Again, I refer to the Sixth Report. We recognise and sympathise with the difficulties of the Department of Health and Social Security in seeking to ensure that the £4,000 million spent on the National Health Service, with its complex organisation and virtually limitless demands, is providing value for money for the taxpayer. The trouble is that we are by no means convinced that it is providing value for money for the taxpayer, and we shall therefore continue to take a close interest in the administration of the service.
I dare say that other members of the Committee and other right hon. and hon. Members will wish to comment on individual matters, and I say just this in parenthesis. I do not know how others find the situation in their constituencies. In my constituency, where we have waited for a new hospital ever since the National Health Service began, someone wanting an operation not of an emergency nature may now have to wait for up to four years to get it. There is something very wrong in the administration of the National Health Service. It seems most unfortunate that we should be looking at a whole series of matters in respect of which there has plainly been failure to account properly, slackness in administration and the rest at a time when every penny needs to be wisely spent in that great Department of State. If we continue to have criticisms about that Department, I hope that we shall do our best to be particularly constructive.
I have already referred to the Committee's Second Report, dealing with Excess Votes for Northern Ireland. As the House knows, Parliament continues to have responsibility for Northern Ireland, and the Committee examined the Northern Ireland accounts on the basis of the reports of the Comptroller and Auditor General for Northern Ireland. We took evidence from accounting officers for the Northern Ireland Departments in the normal way, and we made reports on nine separate subjects. I see that the hon. Member for Antrim, South (Mr. Molyneaux) is here, and I imagine that the right hon. Member for Down, South

(Mr. Powell) and the hon. Member for Antrim, North (Rev. Ian Paisley) will hope to take part in the debate. I shall leave it to them to comment on these various matters.
I wish, however—on behalf of the House as a whole, I am sure—to pay a tribute to the Comptroller and Auditor General and his staffs in Northern Ireland, with a special reference to the great difficulties which they have in carrying through their administration in that part of the United Kingdom at this time.
So much for the specifics; I now turn to more general matters. As the House knows, the Public Accounts Committee has traditionally examined the financial administration of Departments on the basis of particular case studies, some specific and some a great deal wider. These studies are usually prepared by the Comptroller and Auditor General and his staff. In some cases, the Committee has taken an initiative of its own and has then been able to rely upon what has always been first-class support from the whole Exchequer and Audit Department.
I have already indicated the sort of areas which we examined last Session. If anyone doubts that such areas of departmental administration, involving in total the management and control of very large sums of public money, are worthy of the painstaking examination which the Committee tries to bring to bear I can only suggest that he or she reads some of the Committee's recent reports. I saw it suggested in The Times that the aggregate of the sums of extra expenditure to which reference can be found in these reports—in other words, deriving from particular matters into which we had inquired—was no less than £1,000 million. I do not know whether that is the right figure, but it seems to me that, when one talks of a sum of money of that magnitude in the context of the discussion currently going on in this country with representatives of the International Monetary Fund, the House may well reach the conclusion that it must be very valuable to have a Public Accounts Committee, and that it might perhaps be right to consider expanding its work in order to see what else might be found if more investigation were undertaken. I shall return to that point in a moment.
Taking the run of recent years, I think that the reports of the Public Accounts


Committee will be found to cover most of the main activities of the Government and not a few of the smaller ones. To show how apolitical we attempt to be, I recall something once said by Harold Laski—not someone often quoted by Conservatives—that the price of economy, like that of liberty, is eternal vigilance. I am sure that that is right.
It is now widely recognised, as it has seemed to the Committee as it examined Permanent Secretaries and their senior colleagues week in and week out, that even when Departments are reasonably well managed it is in the nature of large bureaucratic organisations that waste and extravagance keep on creeping in, and that a strong and continuous external check is essential to keep them in check. I have no doubt that most of the Permanent Secretaries and other accounting officers who ultimately have to answer for shortcomings of this kind would agree that the system of operational audit—given, I hope, a sharper cutting edge by our Public Accounts Committee hearings—is both necessary and salutary.
So far, so good, if the House agrees with me thus far. The Public Accounts Committee does useful work, but how can the House as a whole play a part? In the first place, it seems to me that some of the issues which are raised in reports of the Public Accounts Committee deserve attention from somewhat broader points of view than the Committee can, or perhaps should, give in the course of its detailed examination of official witnesses. I have referred already to various subjects of this kind which arose last Session.
The use of manpower both for revenue collection and for administering a vast range of social and environmental services is, surely, one issue to which we must give serious and continuing attention. It would, of course, be absurd to expect the House to conduct a complex study of an operational research nature into specific areas of manpower utilisation, but we could at least express views about, for example, the relative importance of achieving complete equity as between one taxpayer and another or the desirability of collecting every last pound of direct and indirect taxation as against the manpower costs of so doing.
I believe that this would be a valuable exercise for the House. The House could

debate, even if we were not able to reach a unanimous conclusion, the merits of ensuring that various types of fees and charges for public services were brought more closely into line with ever-rising costs. Here is an area of real debate about expediture control in the Welfare State.
We could perhaps consider not simply the ideological arguments for or against the setting up of such controversial bodies as the National Enterprise Board or the British National Oil Corporation, but the way in which, if they are set up, they can most effectively be made accountable to the House for their large and expanding operations, based entirely on Exchequer credit.
We could consider, for example, on the basis of experience with the Manpower Services Commission, the advantages and disadvantages of setting up hived-off bodies of this kind to conduct operations formerly under the direct control of Ministers and Departments. Those hon. Members, including myself, who are interested in our defence effort, might even wish to express views on the planning and control of some of the major defence procurement projects on which the Committee recently reported. That is an area that the House could well spend time discussing.
Another of my favourite suggestions has long been that Parliament should specifically discuss the proportion of gross national product which the State now takes. When Plowden first reported it was agreed that this matter would be considered annually. The former Prime Minister, the right hon. Member for Huyton (Sir H. Wilson), used to say that such a debate would be of significance. I endorse that. I am trying to find out whether, in terms of expenditure, we ask the right questions and debate the right things.

Mr. Ian Lloyd: I have been listening with great interest to my right hon. Friend and I am sure that the whole House will agree that his is a profoundly important analysis. Does he not agree that before the House can give the time which these extremely important subjects deserve and require, we shall have to change the balance of time that we accord to legislation and debating important issues affecting the life of the nation?

Mr. du Cann: I agree very much with my hon. Friend. However, I would go a great deal further than that. The whole nation is heartily sick of the frantic way in which we continuously legislate. Most people do not understand what we are doing and have neither the time nor the inclination to follow it. The real sadness is that this plethora of legislation, which all Governments tend to encourage, brings the law increasingly into disrespect.
I also think that the House could, with advantage, go yet further and consider whether, and if so in what way, our contribution to the control of expenditure and the many and varied uses of public funds could be made still more positive. I am no opponent of public expenditure. As the Prime Minister recently said, there are many aspects of public expenditure which are wholly beneficial. I am sure the whole House is agreed on that. I am not an advocate of swingeing cuts in public expenditure just for their own sake. I deeply regret that as a nation we are now in the foolish position where evidence of the Chancellor of the Exchequer's economic competence, in view of informed opinion at home and abroad, will undoubtedly lie in the figure by which the grotesquely huge public sector borrowing requirement is suddenly and painfully reduced.
It follows, therefore, that I am an opponent of the careless style in which public expenditure in this country has been allowed to grow. I hope the House will join me in that. I am an opponent too, of waste, extravagance and a lack of surveillance. I am an opponent, not least, of the way in which precedents in term of expenditure are so often regarded as more significant than a re-examination of their justification in modern terms. Equally, I am an advocate of value for money. I am an advocate of constant surveillance of the way in which Ministers and officials spend the taxpayer's mite. They truly are trustees for the taxpayer.
The question is how well do they, and how well do we, discharge that trust. Using an ordinary analogy, I believe that the Government's attitude is very different from that of all the families in this country who are obliged to temper their expenditure in accordance with their revenue and not the other way around. The Government do not behave in any way like ordinary people. The Government

do not set examples with regard to budgeting, efficiency or cost effectiveness, and so on. It is a tragedy that the Government not only do not do that but do not appear to do it. The truth is that public expenditure is out of control. It has been for many years. It is the biggest inflationary influence in our economy. It is not just a mere embarrassment; it is a danger to our standards of life.
Alas, we Back Bench Members have failed those who elected us and who trust us to ensure prudence and economy in our national affairs. A Budget introduced in the House is never a budget in the ordinary sense of families' affairs. We pass expenditure of millions of pounds on the nod. Debates about supply are not careful discussions of expenditure but mere excuses for political knock-about and an exercise in party loyalties. No wonder the populace is increasingly critical and cynical and yearly more contemptuous of our party games.
A Back Bench Member has one principal duty, namely, control of the Executive in the tradition of our constitutional history and the history of this place. The best, easiest and most effective route is through control of the purse strings in the tradition of our constitutional history and the history of this place.
Our control cannot, on the whole, be effectively achieved in this Chamber. Here we should debate the great social, economic and philosophic issues. It follows, therefore, that the House should consider extending its processes of delegation. If the Chamber cannot do the job—very well, encourage someone else, some group of Members, to do it for the House as a whole. My ideas in this regard—I have published them before and I shall not repeat them—may not be perfect but has anyone else a better idea? If so, I should like to hear it.
I believe that Budgets should be absolute. They should be continually monitored by a Select Committee—a Public Accounts Committee or whatever. There should never be excess without prior approval. There should be no new expenditure without a compensatory saving. In other words, complex though the affairs of Government are, we should do our best to run this country's financial affairs in exactly the same way as any responsible corporation would.
I make one practical suggestion. We are at the outset of the idea of cash limits which would cover just about two-thirds of total Government expenditure. Annual and monthly reports will be made. There will now be an opportunity to compare outturn with forecast. I hope that the Public Accounts Committee will be able to discuss with the Treasury—and I hope the House will think it right that it should—ways in which the Committee may monitor this process and make regular reports to the House. That would be a small task, which is easily within compass, and it would help to reinforce the proposal I made at the outset of my remarks, namely, that the Treasury and the Public Accounts Committee are necessarily always allies.
The control of public expenditure is near the top of the charts recording popular interest. I hope that one day the same will apply in the House. We have this instrument, the Public Accounts Committee, and I am sure I speak for my colleagues when I say that if the House wishes to use that instrument more we shall be very pleased.
I come to my second suggestion, perhaps more fundamental. I make it after having thought about these matters a good deal and having amassed a remarkable volume of correspondence from those who follow them outside the House. I pay particular tribute to Mr. Normanton, with whom I have had most useful correspondence.
In Britain, the Comptroller and Auditor General and his office—the Exchequer and Audit Department—have for many years rendered, and still render, as I hope I have illustrated, invaluable service to the Public Accounts Committee of the House of Commons. They do so, however, within the limitations set by the Exchequer and Audit Departments Act 1866, which was slightly amended—which I doubt many hon. Members will recall—in 1921. That Act was designed to meet very different and much simpler requirements.
For instance, it is remarkable to reflect that in the financial year 1866–67 the amount spent on United Kingdom Supply services was a mere £39 million. That Act, in my view, is now obsolete. It restricts the State audit body in various ways and limits the field which it may cover. For this reason, Parliament has

no access to inside information about the vast public expenditure which is incurred indirectly through local authorities, nationalised industries and subsidised bodies of all kinds. There was no such spending in 1866.
I strongly suspect—I do not know what right hon. and hon. Gentlemen feel, and in view of the absence of information one cannot be sure—that there is far greater waste and extravagance in these uncharted areas than that which is reported from the Ministries, which are, after all, accountable to the House through the State auditors. I have already suggested that it has been estimated that the figure from this year's report at which we are looking may be £1,000 million. Very well; we can add to that another speculative figure. We must find an apparatus for surveying this area in detail. I do not know how strongly right hon. and hon. Gentlemen feel. I happen to feel passionately on the subject, as hon. Members know.
If there is strong feeling in Parliament that our control over public spending should be revived and strengthened, the most effective measure would be to inquire into the 1866 Act and bring it up to date. We always think that we attend to matters here very much better than anyone else. Alas, that is not always so. There has been a great deal of progress and experiment in foreign countries during the past half-century. This provides a mass of comparative material which deserves examination.
For instance, some hon. Members may be surprised to learn details of the increasingly comprehensive services that are provided to the Congress by the Comptroller General of the United States and his General Accounting Office. I have had the good fortune to go into that office and to survey it for myself. For the sake of hon. Members who are not familiar with it, I just say that it is a State audit body which employs graduates in management, economists, lawyers, engineers, mathematicians and other specialists, as well as accountants, with which our body, the Exchequer and Audit Department, is exclusively concerned. That is an instance of what is happening, and it might perhaps happen here if we thought it right.
State audit services could be devised to meet almost any new requirements which


Parliament might express or any revised Committee arrangements such as those I have advocated in the past which come outside the narrow constraints of mid-Victorian statute. We have thrown off many Victorian constraints; some I regret, most I do not. Here is one which I am as certain as I am standing here it is the duty of the House to throw overboard. It is time that we had a new look at this whole field.
Time has moved on, and the whole business of government has changed vastly, unbelievably and unrecognisably since the statute was passed. We must assess the new needs and adapt old institutions to satisfy them. We should find a way of inquiring into the whole subject of public accountability. I do not know whether the House would like the PAC to report. I do not know whether it would like to set up some other body, perhaps a Royal Commission. What I do know is that the job ought to be done, and it is urgent to make a beginning. That is a matter which is fundamental to the improvement of government. As such, it must be a matter of concern to hon. Members in all parties.
We have already drifted much too far. It is surely the duty of the Public Accounts Committee Chairman to warn his colleagues and friends of the real dangers. I hope that the House, in its wisdom, may resolve at long last to take these matters more seriously, to correct the situation and to set up proper methods of inquiry, supervision and control. In the meantime, I commend the reports to the House.

5.6 p.m.

Mr. John Garrett: I wish to take up the final theme of the speech made by the right hon. Member for Taunton (Mr. du Cann). Speaking in the debate on the Public Accounts Committee Report in January 1975, I felt obliged to draw the attention of the House to what I felt were some extremely serious shortcomings in our system of State audit as operated by the Public Accounts Committee and the Exchequer and Audit Department under the Exchequer and Audit Departments Act 1866. Those criticisms are still valid and worth repeating at intervals of every two years or so.
It is still true that compared with the State audit systems of other Western

countries, ours is the least expert, the least comprehensive, the least independent of the Executive and the narrowest in coverage. It is also possibly the most eulogised.
In terms of the qualifications of our audit staff, there has been one improvement since I last spoke on the subject. Recruits to the Comptroller and Auditor General's Department now have to acquire an accounting qualification. Of the 622 members of our audit staff, nine are qualified accountants or chartered secretaries. Let us compare that with the level of technical expertise of the staff of the Comptroller General in the United States. He employs an entirely technically qualified staff of 2,500 accountants, 530 management specialists, 126 attorneys, 103 mathematicians, 36 engineers, 37 computer scientists, 177 economists and other social scientists and 186 other professionally qualified staff. American State auditors can in every way match the expertise of the departments and agencies they are auditing.
Our State audit staff are recruited as school leavers or promoted from lower grades. In every comparable body in other countries auditors are technically qualified graduates or have post-graduate qualifications. Our audit staff are graded in the Civil Service executive grades at middle and junior management levels, with the unfortunate consequence that they have a status inferior to that of the officials on whose actions they report.
Over the years, the Comptroller and Auditor General has developed the depth of his inquiries from merely establishing the regularity or propriety of expenditure to establishing whether there is waste or extravagance, although he is not in any thorough way concerned with the efficiency or effectiveness of spenders of public funds.
It is clear from the reports that we are considering today that the main thrust of the Comptroller's inquiries concern overspending, financial control systems, and administrative error—all looked at in hindsight and nearly all followed by a recommendation that the Department in question must do better next time.
Let us compare these reports with the standards laid down for the audit of government functions developed by the


General Accounting Office in Washington and issued in 1972. The foreword to these standards said that Government auditing could no longer be a function primarily concerned with financial operations. Instead, Government auditing should be concerned with whether governmental organisations were achieving the purposes for which programmes were authorised and funds made available, were doing so economically and efficiently, and were complying with applicable laws and regulations.
The Government audit of the United States sees three main elements in its task. The first is financial compliance, which represents the traditional regularity audit. The second is economy and efficiency, and
whether the agency is managing or utilising its resources (personnel, property, space, etc.) in an economical and efficient manner, and the causes of any inefficiencies or uneconomical practices including inadequacies in management information systems, administrative procedures, or organisational structure".
The third item is programme results and
whether the desired results or benefits are being achieved, whether the objectives established by the legislature or other authorising body are being met, and the extent to which the agency has considered alternatives.
In Britain, our Government audit is still primarily concerned with the first of these tasks, and not the second two.
Next, only a small part of public expenditure is covered by the central Government audit in this country. The nationalised industries are not covered, the local authorities escape—so that Parliament has little information about their use of funds—and hundreds of private industries, and quasi-governmental or State-supported bodies which are users of State funds are not subjected to any test of public accountability for the use they make of those funds.
The principle of public accountability for the efficient and effective management of Government Departments has not been accepted in this country. This question is referred to the Civil Service Department, which is part of the Civil Service, and its inquiries are carried out at the invitation of, and totally dominated by, the Departments whose operations are to be investigated. In other words, the Civil Service examines its own efficiency.
Our Exchequer and Audit Department is far too closely allied to the Executive. It is nothing like as independent as other state auditors. The Treasury has an unhealthy influence in appointing the Comptroller. The form of the accounts is decided by the Treasury—and they are exceedingly uninformative—and the Treasury is also responsible for deciding which Departments will submit accounts to the Comptroller.
The Treasury—now the Civil Service Department—reserved to itself under the 1868 and 1921 Acts the regulation of recruitment, salaries and scrutiny of the Exchequer and Audit staff. So the Executive has a great deal of power over its own auditors. Such a situation obtains in this country, but does not obtain in any other State audit department.
Let us again compare this arrangement with that in the United States, where the Comptroller General obtains the budgetary appropriations for his department, the General Accounting Office, directly from Congress, after making up his mind what resources he needs. The Cour des Comptes in France and the Federal Commissioner in Germany enjoy a similar statutory independence.
Our system of State audit was a pioneering innovation in 1866, but it has hardly developed since, while the accounts to be audited have increased in value from £70 million to £35,000 million. We need a system which subjects all spenders of State funds to an independent, comprehensive examination, reporting and accountable only to Parliament. This would do more to lessen the dominance of the Executive over the legislature than any other single reform. The great pity is that so few Members of Parliament are interested. They believe that adequate control over Government can be exercised by debate and questions, but the truth is that it can be exercised only by powerful investigatory committees.
A number of reforms are needed and they are quite simple. We need a legal definition of public funds which is far wider than at present, and the statutory right to call all spenders of public money, whether in private industry or public service, to account to Parliament for their financial regularity and management effectiveness.
We need a State audit body with statutory independence from the Treasury and


the Civil Service Department. We need a State audit body of professionally-qualified staff, seconded in teams of about 30, to approximately a dozen parliamentary committees which would combine the present functions of the Expenditure Committees and the Public Accounts Committee. Each committee would shadow a Government Department or group of small Departments. The Committee on Nationalised Industries would continue with its own audit staff.
In our PAC debates over the past 100 years, hon. Members have eulogised our system of State audit, apparently unaware of developments in other countries. It does a very useful job within its limitations, but these limitations are now so scandalously great that they are a major constitutional weakness.
Parliamentary democracy is lessened by the inability of the House to call the spenders of public funds to account. It is time for a change.

5.18 p.m.

Sir Timothy Kitson (Richmond, Yorks): I do not disagree with many of the remarks made by the hon. Member for Norwich, South (Mr. Garrett). I thought when he began that he would criticise the Public Accounts Committee, but the Committee can work only with the staff provided for it, and it is true that our systems for watching Government expenditure are wrong. Often, the Committee can close the stable door only after the horse has bolted. This was what my right hon. Friend the Member for Taunton (Mr. du Cann) said in some of his opening remarks.
Looking back through the reports of Public Accounts Committee debates in this House, one finds that, time and again, members of the Committee and other hon. Members have asked for more stringent and effective powers to be provided for the Committee. I am sure that we would all welcome this. It becomes more necessary as public expenditure continues to rise every year.
During last year's debate on the PAC Reports, many hon. Members complained at the delay in holding the debate long after the reports had been published. Like other hon. Members, I am gratified that we are having this debate before Christmas. As this request was made

by many hon. Members, we ought to thank the Leader of the House for meeting our wishes for once.
I am grateful for all the guidance and work of the Chairman of the Public Accounts Committee, my right hon. Friend the Member for Taunton (Mr. du Cann), for the admirable way in which he chairs our Committee, for the way that he introduced the debate and for the full account of the Committee's work that he gave to the House. After my right hon. Friend had covered practically everything in the reports one could simply have said "Amen", because he had made so many points.
One of the main concerns of our constituents is the high rate of Government expenditure. They pay particular attention to poor budgetary control and dislike seeing Government money carelessly spent. They dislike waste. I often hear people say that if they ran their affairs or businesses in the way that Government Departments spend taxpayers' money, they would go broke. I am sure that is true. It seems that to some Government Departments, a few million pounds here or there, or even a few hundred million pounds, does not seem to matter.
The public have been made more aware, as a result of the efforts of both Press and television in pinpointing unsatisfactory findings, resulting from inquiries of the Public Accounts Committee. These have been brought to the attention of the media by the Press conferences that are held on the publication of our reports. I welcome this growing interest.
In our debate in January last year, many of us pointed out that we felt that if we were to do our work successfully, it was necessary for the House to have better information on Government spending programmes and for the Treasury to have far stricter control over Government Departments. It is encouraging to see that the Treasury is now calling for Departments to make monthly statements of their spending programmes. This must lead to better budgetary control and will surely give fresh opportunities to our Committee.
In many of our inquiries into overspending by Government Departments, we find that they come to the attention of the Comptroller and Auditor General only years after the event. With the


new system in operation in the Treasury, I think that if the Commitee were able to examine the monthly reports it might be possible for us to pick up some of the overspending mistakes a great deal more quickly than we are able to at present. I support my right hon. Friend the Member for Taunton in his call for the Committee to be given an opportunity to look at the reports.
I am sure that hon. Members who have had time to read our reports will come to the same conclusion as that reached by many members of the Committee. As the years go by, the mistakes and errors become increasingly horrific. We hear so often in our cross-examination of Permanent Secretaries—who are accounting officers of Departments—that they have difficulty in explaining the mistakes because they were made years before, when the Permanent Secretary was not responsible for the Department.
If we were able to look at the monthly accounts rendered to the Treasury, this argument would not be valid. It is unfair for the Committee to take an accounting officer to task if the specific case it is investigating happened some time before he had responsibility for the Department.
Of course, I realise that even with the opportunity of examining these monthly reports, many of the cases that we consider would still not have come to light until the Auditor General had had the opportunity of investigating the accounts of the Department, but if we were able to examine the position monthly, the work of the Committee could become more effective and overspending by Departments might be curtailed to some extent. This would add teeth and strength to our work.
It will be clear to hon. Members who have considered our reports that budgetary control in some Departments is very much worse than in others. The Department of Health and Social Security seems to come under a great deal of scrutiny from the Committee every year. This year we looked at delays in rendering health authority accounts, trust funds of health authorities and special trustees, hospital staff catering, the National Health Service experimental computer programme, the closure of hospitals and disposal of surplus land, hospital works

services and financial control of expenditure by the NHS in England. This is a large and diverse number of subjects to be considered from within any one Department, and the explanations we received from the Departments were highly unsatisfactory, to say the least, in many cases.
Paragraph 133 of our Sixth Report says:
In recent years and again during this Session Your Committee have examined a number of matters where it has appeared to us that there have been defects in the financial control exercised by hospital authorities over expenditure from public funds provided through the Department of Health and Social Security. We have been disturbed by the need to report critically in successive years after our examination of the accounting officers of the DHSS, and we must again emphasise the importance of effective methods of financial control, and of according the highest priority on behalf of the taxpayer, to obtaining value for money in the NHS.
I am sure that most members of the Committee will agree that at present we are not getting value for money from this Department.
It is apparent to many members of the Committtee that, following reorganisation of the National Health Service, effective methods of financial control have continued to deteriorate and, as stated in the above paragraph, we have had to report in successive years very little improvement in the methods of financial control. I only hope that next year the disturbing features which were drawn to our attention will not reappear.
One example occurs in the disposal of land. Although only small amounts of money are involved, the methods and systems for disposing and handling land which is surplus to the requirements of the Department are wholly inadequate. There seems to be no sense of urgency.
Where land was being held pending a sale, the authorities failed, in some cases, to get a reasonable return on land which was awaiting disposal. We found one example where the DHSS farmed about 300 acres of its land, and lost £3,000 a year. After doing this for a number of years, it let the farm for £18 an acre, which, in my view, would be a very low rent even in a mountainous area, let alone the good farming area in which it was situated. We discovered that the Department has about 2,000 acres awaiting disposal, but there always appear to


be strong reasons for delaying the sale. Some of the reasons given were difficulties in establishing proper boundaries and rights of way, but these have to be established in normal transactions anyway.
In 1967, when the Ministry of Health started an experimental computer programme, the PAC was not impressed by its achievements. Indeed, in one case, as my right hon. Friend the Member for Taunton has mentioned, the scheme was suspended by a hospital in September 1972, but the DHSS did not discover the suspension, although it was a partner in the scheme, until nearly a year later.
I have the impression that in the Health Service we have more and more people on the administrative side and fewer working on the wards and looking after the patients.
The story of the reorganisation of the employment and training services is not much better. The increase in staff between January 1974 and May 1976, of 37 per cent., and the cost of setting up jobcentres, which were extremely expensive, convinced some of us that the country was getting a poor return for its money.
I think that most hon. Members would agree that as not only the proportion of GNP but the actual amount of public expenditure increases year by year, the work of the PAC becomes more important. There would not be enough time in a year if we sat all day and every day to scrutinise every problem drawn to our attention.
While Government expenditure rises yearly, the number of Members on the Committee and the time available to do our work remains constant. Not only that; the demands made on hon. Members from both our constituency and our constituents and the ever-increasing quantity of paper that falls upon us makes our job more demanding every year.
To help hon. Members who are not on the Committee, I should like an abbreviated report on our work to be circulated to every Member at the end of each year, taking just a small number of the points made in our six reports. This would make interesting and easier reading for our colleagues.
I know that most hon. Members are submerged in paper and when they receive six reports from the Committee they must throw their hands in the air and ask "Where do we start?". More of our work would be considered if we had these abbreviated reports.
As I mentioned before, I should also like the PAC to consider the monthly reports on expenditure programmes sent by Departments to the Treasury. I hope that our Chairman can discuss this with the Financial Secretary, so that when the House reassembles after the Christmas Recess these documents will be available to the Committee and that, with this information, the PAC will provide an even better service to the House of Commons.

5.30 p.m.

Mr. Andrew F. Bennett: Not being a member of the Public Accounts Committee, my knowledge of it comes merely from reading the Committee's reports and listening to debates on its works. Much of my concern is that while the Committee is supposedly looking into the efficiency of the work of Government, it does not seem to be operating in the most efficient way itself. It is interesting to hear criticism from members of the Committee of their own work. Perhaps they should have included a few firm recommendations as to how they might change their mode of operation and make themselves rather more efficient, possibly on the lines suggested by my hon. Friend the Member for Norwich, South (Mr. Garrett).
It seems high time that members of the Committee should review the way in which they operate. It is ironic that they are looking into the inefficiencies of Government, yet they themselves are doing so in a very inefficient way. One could ask how much money they have got back as a result of their investigations. It does not seem to me that they have achieved very much. Have they spotlighted any error or inefficiency which has resulted in a Minister's resignation? The problem is that by the time the Committee begins its investigation it is almost certain that a different Minister will be responsible. One could ask what effect the Committee's investigations have on civil servants. Does a black mark go down in a record against a civil servant who has been particularly negligent?

Mr. John Garrett: He is promoted.

Mr. Bennett: I am not certain that the civil servant is promoted, as my hon. Friend suggests.
When the report was being introduced by the right hon. Member for Taunton (Mr. du Cann) he appeared to be saying "We hope that it will never happen again." Circumstances change, so it is not likely that the precise circumstances will happen again, but it seems that year after year some particularly horrific story comes out of the Committee's investigations. This happens continually. The question of looking into accounts goes back to the running of private companies and the idea that at the end the accounts will show that there is a profit and some share-out of profit.
When looking at the way Government Departments are run, it does not seem that we are concerned at the end of the year to see whether there has been a loss or a profit. We need to see whether they are sensibly allocating their resources and ensuring that things are being monitored as they go along, so that there is clear evidence, the day after, that there has been overspending or misuse of resources, and that this is not investigated two or three years later.
If the Committee is to be effective, it must have power to question what is happening now. Paragraph 134 of the report referred to the NHS. The Committee was critical of what was happening in the NHS and suggested that it was a difficult year and that sooner or later the Committee would have to return to the subject, and hoped that, when it did, the NHS would be in better shape. I should like the Committee to ask the NHS how money is being allocated this year, and not what they were doing in 1975. Another major problem is the assumption that a Department has gone wrong if it has overspent or perhaps if it has underspent. But what about the Department that has spent the exact amount of money that was allocated to it? We need to know if that Department performed well. It may have misused its resources just as much as, if not more than, another Department. The Department may have said "We have this money to spend—let us dish it out and use it in this way". If one has to work to a budget, it depends how generous that budget is.
If one is lucky enough to have a generous budget one can spend it very inefficiently, but circumstances may change in a way that leads to the spending of more money. It is important that the Public Accounts Committee should be looking at all Departments, and the reason for pursuing the Department should not be that the accounts are overspent or underspent. We should be questioning how the money is spent. One problem is how far we should go back.
Question 3411 of the report refers to the computer situation at King's College Hospital. The Committee was very critical of the Department of Health and Social Security because it took from August 1973 to February 1974 to decide, after it had been informed that things were going wrong, that the project should be stopped.
The Chairman of the Committee said he thought that there should have been rapid action within a month. It seems ironic that the Committee is criticising the Department for taking seven or eight months to take action, yet the House of Commons has taken several years to get round to looking at that same point and making some criticism. For the Committee to continue in its present way is to compound the waste of public resources. Its inquiries are not doing anything to rectify the position. In many cases they are doing real harm to the whole public service by creating a myth that there is a vast amount of inefficiency in the Government services. I am certain, as the report suggests, that there is some inefficiency, but when we come to examine the matter the scales are completely different. The amounts involved in many areas are very small compared with the total amounts of money that have been spent.
I suggest that we should have a Committee which first of all produces a report on its own procedure and then suggests that the procedure should be altered. The area that concerns me most is the computer experiment carried out by the Department of Health, which seemed to be one of the most tragic misuses of public funds raised by the Committee.
What disturbs me about paragraphs 105 to 118 of the report is that there was no clear statement from anybody why the Department was going to carry out this experiment with computers and what


financial saving it hoped to achieve as a result of the introduction of computers.
It seems reasonable in a study to hope to achieve something and then decide to go into it and fail to achieve one's aim.

Mr. A. P. Costain (Folkestone and Hythe): I sat on the Public Accounts Committee when I first came to the House about 17 years ago. The hon. Member should appreciate that the Public Accounts Committee deals with the past, while the Estimates Committee deals with the present. Is he not confusing the objectives of the two, or is he trying to suggest that the two Committees should be amalgamated?

Mr. Bennett: The two Committees should in many ways be looking at the same problem. The powers of the PAC to investigate what is happening should be greatly enlarged. I am not happy with the powers which the Committee now has to get things effectively put right.
Returning to the subject of the computer programme, I appreciate the difference between the styles of the two Committees. I said that in scrutinising the Government services we are in danger of falling between the two Committees, and of not getting the spotlight turned effectively on the way in which Departments operate.
The computer programme is most deplorable. There was never any clear objective of what it hoped to achieve to enable the experiment to be evaluated from the start to see whether it was worth while. Since no objectives were set, it was very difficult to measure anything at all. It makes me very angry to see £8 million or £9 million used up by the experiment, bearing in mind the state of the National Health Service in my constituency in Stockport. Had that £8 million or £9 million been spent on improving geriatric facilities in Stockport, there would have been a great deal more satisfaction among people using hospital facilities there.
I am certain that some constituents of mine who are looking after sick or elderly relatives in very difficult circumstances and are trying to get those people into hospital but are unable to do so because of shortage of beds, would be very angry indeed to read of the money wasted on the computer experiment. The consultants

dealing with geriatric patients would be angry because instead of being able to treat their patients they have to spend a lot of time working out priorities, in terms of who should be admitted to hospital, whereas the patients should all be admitted straight away. That will make many people angry. I believe that this money could have been spent on hospitals in Stockport. However, I appreciate that it would be out of all proportion to the need of the care of geriatrics throughout the country.
I am concerned about another important matter—accountability and accounting in general within the National Health Service. I was pleased to see from the Government publication on the sharing of resources in the NHS that at least the Government are beginning to examine the way in which resources are allocated nationally. However, there is little idea how the resources should be allocated within area health authorities and hospitals. There is a crazy situation in Stockport, where a new maternity hospital has not been fully used since it was opened, whereas there is an appalling shortage of geriatric beds, with very old buildings being used for psychiatric patients in the area. There seems to have been a misallocation of resources.
It is interesting to examine waiting lists in Stockport for various hospitals, and requirements for treatment. There are fantastic variations from list to list, but nobody seems to have costed the misery caused to people on the various lists or to have considered the priorities. For example, one could have considered whether it would be better to carry out 50 hernia operations or one kidney transplant. It is high time that we tried to bring to the NHS a way of working out priorities at that level.
It is said by many people that doctors make the choices, in that they may choose to treat one patient with a kidney problem rather than another patient. Having discussed the matter with doctors, I suspect that they realise that there are many moral issues involved and, more often than not, in making their choice leave the matter to chance factors. I believe that as a nation we need to bring more rational thinking to bear on the allocation of resources within the NHS.
I plead with the PAC to examine its own working methods, and I hope that


the NHS will expend much more effort in producing accounts and in working out the costs of various treatments and the priorities given. Although we shall never have sufficient resources to meet all the demands, we can at least try to improve people's health.

5.42 p.m.

Mr. Michael Grylls: I suspect that the hon. Member for Stockport, North (Mr. Bennett) is being excessively ambitious in asking for so much detailed material for the members of the Public Accounts Committee to examine. I make my comments with great diffidence because, in a sense, I come into this debate as an intruder since I am not a member of the PAC.
I wish to refer to one subject mentioned in the able speech of my right hon. Friend the Member for Taunton (Mr. du Cann), namely, the National Enterprise Board. I am sure that the House increasingly will want to examine the financial control and proper monitoring of the board and its operations as it develops. I speak as somebody who does not like that animal very much, but we are landed with it and in terms of financial control we must carefully consider its operations.
My right hon. Friend the Member for Taunton said that he had discussed the matter with the Secretary of State for Industry who was sympathetic to the problem and thought that the board's activities should be properly scrutinised. We are glad to hear that, and it is encouraging, but I wish that the Secretary of State would carry his sympathy to the extent of answering Questions. It is one thing to be sympathetic, but when I and other hon. Members table Questions we do not seem to get much in the way of answers. We are given answers on the lines "This is a matter for the NEB and not for the Department." It appears that the needle has got stuck in a groove, and that Questions are not being dealt with on this important subject. If we cannot obtain answers in the House, perhaps the PAC should take on the job.
The PAC seems to have hit the nail on the head in its report, in paragraph 64, where we are told that it is important that there should be proper arrangements to ensure public scrutiny of the NEB and its activities. The report calls

for as much information as possible on methods of control of major Government-assisted industrial undertakings which are part of the NEB set-up. At the end of that passage the Committee leaves a question mark about what should be done. Perhaps the House could think about that matter. The NEB is by no means a minnow. In public expenditure forecasts up to the year 1980 it has been allocated £1,000 million to spend. It is an enormity in terms of consumption of taxpayers' money, and we must carefully examine its activities.
When the board came into existence after the passage of the Industry Act 1975 there was an exchange with the then Leader of the House, Mr. Edward Short, on 18th December 1975. He said that the House would be able to obtain answers to questions from the Secretary of State for Industry. I quote from the words of the then Leader of the House:
My right hon. Friend will also, within the well-understood limits imposed by the need to maintain necessary commercial confidentiality, be answerable to the House on aspects of the Board's day-to-day management that raise issues of urgent public importance or concern national statistics. He will also be answerable, as appropriate, for the activities of the Board in its capacity as a holding company…."—[Official Report, 18th December 1976; Vol. 902, c. 1658.]
The House may well take the view "So far, so good". It appeared at that time that shortly after the board was set up the House would be able to have its Questions answered and carefully to probe the board's activities, but that has not happened. We have not had answers to parliamentary Questions. The interim statement which had to be made after the first six months of the board's existence, in accordance with the Industry Act 1975, was a skimpy statement indeed. If such a statement had been made by the chairman of a quoted company on the Stock Exchange it would have been given short shrift by shareholders. Again, the problem was that one could not ask a Question on the subject and be given a satisfactory answer.
The interim statement said that the NEB had put out loans of £5·6 million. I asked a Question of the Secretary of State requiring him to tell the House to whom the board had lent that figure. I wanted him to produce a list of the people involved. That was a modest


and, indeed, reasonable demand, but again I was not given an answer. The interim statement was a scruffy document, it was typewritten, it was tucked away in the Library, and it was not easy for hon. Members to get at it.
Draft guidelines for the NEB were then published. Those guidelines were not dated—and it was as well that they were not dated, because they have not been debated by the House since they were published in June, and indeed there has been no statement on definitive guidelines by the Department of Industry.
Therefore, we are left with all sorts of good intentions in the guidelines, such as proper parliamentary control, with which we should not quibble. But they have not been published as affirmative guidelines and there has been no debate. That is inadequate for a body which will be allowed to spend £1,000 million of taxpayers' money.
The capital structure of the NEB—my hon. Friend the Member for Chichester (Mr. Nelson) has mentioned this in a number of debates over the last few months—has not been outlined by the Government. I put down a Parliamentary Question on 28th June this year to the Prime Minister. I got short shrift from him. He passed it to the Secretary of State for Industry, but he did not answer it either. So, a year after it was set up, we have no idea of the NEB's capital structure. That is extraordinary.
We have not been told what return on capital the NEB is expected to produce. The hon. Member for Sowerby (Mr. Madden) is on the Committee and is very interested in the NEB. If he thinks that it is so good, no doubt he will persuade Ministers to publish forecasts of return on capital. In Sweden, for example, the Statsforetag, which is roughly the equivalent body, publishes its resources, results and yield on total capital employed in detailed terms. Details have actually been published in the Economist in this country, so they do not mind telling people what is going on. But there has been not a squeak from the NEB.
My right hon. Friend the Member for Taunton, as Chairman of the Committee, properly used moderate language, but I am not a member of the Committee and

I do not feel in a mood to use moderate language. Our constituents, the taxpayers, do not expect us to be moderate when we think that Ministers have shown a total lack of responsibility in dealing with this sort of spending power.
I asked a question about staff and was told that that was a matter for the NEB. I was given the same answer about return on capital. I was even impertinent enough to ask a question about the administrative expenses of the Organising Committee, which is perhaps a bee in my bonnet at the moment. I was told that they are £414,000, and this is before the NEB was set up. I was impudent enough to ask how the money was spent. It will probably shock the Financial Secretary to know that the Minister would not reply and said that it was a matter for the NEB. But the NEB would not tell me a word.
I do not criticise Lord Ryder, who is doing a difficult job. He was foolish to take it on because it will be a very short-term job, but he does it well. The people I criticise are Ministers who will not give the answers that hon. Members have a right to expect. We had announcements this week about the British Leyland Mini replacement programme. The right hon. Member for Down, South (Mr. Powell) may say that it is ridiculous for Members of Parliament to try to make judgments about detailed industrial matters. I agree, but the NEB is involved through its 95 per cent. holding in British Leyland. What information have we had about the biggest investment programme that the NEB is putting forward? We have been given no detailed figures of output or productivity targets. Thus, parliamentary accountability by, and control of, the NEB is very bad.
The other day I asked whether the annual and interim accounts of the NEB could be placed in the Vote Office and not just slipped into the Library in what I consider a surreptitious way. Those of us who follow something closely can get details from the Library, but when such a huge amount of money is involved these things should be available in the Vote Office and sent to hon. Members. When I asked about that I was told that it would not happen. So the six-monthly report, and no doubt the annual report which is due at the end of this month, will be slipped into the Library.
I want to quote two ways in which money can be lost. These are two investments currently held by the NEB—admittedly small ones. The first has been much in the news recently—Dunford and Elliott. When the IRC first invested in that company in 1969, the cost was about £1 million, but it was transferred to the NEB for £122,111. Thus, through the folly of the IRC and the equal folly of the management, the taxpayer has lost about £800,000. Brown Boverie Kent, the instrument maker, was purchased for £6·5 million by the IRC. A few months ago, the company was transferred to the NEB for £4·9 million. Nearly £2 million of that investment has apparently disappeared.
I hope that what I have said will at least give an idea of the way in which the NEB is slipping outside the net of parliamentary control, to put it mildly. I hope that the House will accept these proposals. First—I say this in no belligerent sense: I am calm now—the Secretary of State for Industry must answer Questions on the Order Paper. We are not a lot of tiresome people—at least, not most of the time—and our Questions should be answered. I hope that the right hon. Gentleman will not stonewall or be obstructive.
Second, the annual and interim reports should be readily available and properly printed. Third, the details of the NEB's acquisitions should be given to Parliament. We should not continually be told that these are matters for the NEB and then have to rely on the information that we get from the Financial Times and other financial papers. There is no way of knowing that the NEB has taken over a company with our money until we read it in the Financial Times. I spend my time looking in that paper for details of how our money is slipping away.
Fourth, the Public Accounts Committee should be able properly to monitor and to question the senior management of the NEB. It should have a proper insight into the figures. After all, the PAC represents all the shareholders of the NEB and should be able to question the NEB, just as we always say private shareholders should get off their bottoms and question private companies.
The NEB is a new body which may not live long. It may be executed fairly soon. But while it functions we must ensure

that there is proper parliamentary control. The Financial Secretary may not be able to answer all these questions tonight, but I hope that he will at least pass on their general burden to the Department of Industry and ask that Department in the year ahead at least to try harder to account to Parliament for the activities of the NEB.

5.59 p.m.

Mr. John Watkinson: I agree with the hon. Member for Surrey, North-West (Mr. Grylls) that the National Enterprise Board should be brought within the purview of this Parliament and of the Public Accounts Committee. However, I do not agree that the life of the NEB will be short. I hope that it will last for many a year yet.
My first duty is to congratulate the Chairman of the PAC, the right hon. Member for Taunton (Mr. du Cann), and to say how proud I am to serve on that Committee and how enjoyable it is to be a member of it.
As a member of the Public Accounts Committee, I am grateful for the briefs and services rendered to it by the Comptroller and Auditor General. I noted the scalding remarks which my hon. Friend the Member for Norwich, South (Mr. Garrett) made about the Committee and about the State audit system generally, but I am grateful for small mercies. I have not doubt at all that the effectiveness of the Committee is largely brought about by the professional services which we have available to us.
From talking to colleagues who serve on other Select Committees in this House, I know that they envy the services we have. Indeed, I know of very important Select Committees of this House which have available to them only an assistant on a part-time basis, yet they are Select Committees dealing with vital areas of public expenditure.
There is a great deal in why my hon. Friend the Member for Norwich, South said about the Public Accounts Committee and the State audit generally. With him, I would welcome a wider definition of State funds, so that we in this Parliament could bring within our purview—and perhaps within the purview of the Public Accounts Committee—the expenditure of local authorities and the expenditure of nationalised industries. Here


are two areas which are of vital concern to us as a nation and over which it is extremely difficult for us as Members of the House to have any form of direct control.
There must be a great deal of weight in the suggestion that the State audit should be separate and apart from and totally independent of that of the Treasury. If we are investigating Departments of State—and we all know that the Treasury is the senior Department of State—there is a great deal to be said for the provision of services to the Committee being separate from those of the Treasury. I also agree 100 per cent. with my hon. Friend's suggestion that there should be a much wider cross-section of persons, variously qualified, who could lend their assistance not only to the Public Accounts Committee but also to other Select Committees of this House.
From my experience in the short period during which I have been a Member of the House, I can certainly say that the most effective work which I see being done is done in the Select Committees. I am a great supporter of the Select Committee principle. I should like the Select Committee to have available to them the sort of professional staff and professional expertise which we know to be available to committees in other countries but which are singularly lacking to us in this Parliament.
I find it agreeable and acceptable that in our Select Committee procedure we are so often able to act in a bipartisan way. The Chairman of the Committee referred to this. I find no difficulty at all in combining, in studying and examining whether we are spending our money effectively, with those with whom I might disagree on matters of general policy.
There is a Committee reporting on the procedures of this House. I hope that when it reports it will give added weight to the authority and the status of our Select Committees. I know that my right hon. Friend the Leader of the House does not share my views about the work of these bipartisan Committees. He has indicated to Members on the Government side that he is against the bipartisan principle. I see no objection to bipartisan activity in these Select Committees.

Indeed, I should like to see it extended, because I agree fundamentally with the proposition that it is only in the Select Committees that we are able to get at the Executive and question the Departments.
It is very rare indeed that one sees a Minister discomfited in this House at Question Time. It is so easy for a Minister to fudge the issue, knowing that in a short while the House will move on to the next Question. But in our Select Committee proceedings we can really get down to the nuts and bolts and adopt the investigative approach which is so vital. In my view, the people of this country expect us as Back Bench Members to be investigatory persons in our inquiries concerning the Executive.
For that reason I would support the proposal—which I believe has been put forward on previous occasions by the Chairman of our Committee—that perhaps our proceedings should be broadcast. There is a sense in which the immediacy of the event has a news value and a news worth which is perhaps lost when the matters are discussed at a late stage in a single debate in this Chamber. I am a supporter of the broadcasting of the events in this Chamber and would be in favour of extending it into our Select Committee as well. I appreciate that there are areas of our discussions in the Select Committee which cannot be broadcast, for reasons of State security, but there is no reason why certain other matters could not be broadcast so that the public can see that we are exercising this control over the Executive.
I believe that another area in which there should be some reform is the right of the Public Accounts Committee and Select Committees generally to call Ministers before them. I know it is said that it is not the function of he PAC to inquire into or deal with policy matters. Nevertheless, during the course of our inquiries we cannot avoid coming into contact with policy issues.
The Chairman of the Committee and the hon. Member for Surrey, North-West mentioned one such area, namely industrial policy. We had before us the civil servants from the Department of Industry, who were discussing with us the new criteria for assistance to industry. During


the course of those discussions we investigated and made inquiries into the operations of co-operative enterprises. It was inevitable from the deep probing which took place in the Committee that the civil servants—I do not blame them for this—referred to ministerial enthusiasm and to the ministerial wish that that project should go ahead. It would have been helpful to us if we had been able to question the Ministers from that Department as well.
It is a very unsatisfactory state of affairs—but one which civil servants no doubt welcome—that civil servants have to hide behind the fact that it was the ministerial wish that a particular project should go ahead. If we are to be a proper investigatory body, it would be much more effective if the Ministers were present before the Committee so that we could question them if we wished to do so.

Mr. Peter Hordern (Horsham and Crawley): Does not the hon. Gentleman agree that we have every right and every power to summon persons and papers, and that this power entitles us also to ask Ministers to attend upon our proceedings? I agree with the hon. Gentleman that we ought to make proper use of this power.

Mr. Watkinson: I am grateful to the hon. Gentleman for his intervention. I hope we shall do this in future, because there are certain areas—particularly the one I have been discussing in which it would be beneficial to have the Minister present. I accept that there are large areas of our activities in regard to which it is not necessary to have the Minister present. For example, there was the farcial case of the RARDEN gun, in which the gun would not fit the machine. That is a question of technical management over which the Minister clearly cannot have any direct responsibility. But there are certain broad areas in regard to which it would be advantageous to have the Minister before us.
The Chairman of the Committee referred to the fact that during the course of our inquiries we dealt with the co-operatives. The criticism which appeared in our report caused a good deal of Press publicity. An important issue that was examined by the Public Accounts Committee but was not brought out in the

Press reports was that when the co-operatives were set us—they are ventures that I wholeheartedly support—they were under-capitalised. The Chairman said so during the course of our inquiries. The witness before us admitted that the Department would have been prepared to see an extra £1 million put into the Kirkby Co-operative if it had been requested. It seemed that in those circumstances the Department was relying overmuch on the advice given to it by the co-operatives. The witnesses virtually admitted before us that they recognised that the co-operatives were under-capitalised at the outset.
Another general point that has come to my attention during the course of our proceedings is the difficulty that is always occasioned when the Government come into contact with a business deal with outside parties. To continue with the example of the co-operatives, the valuation of the assets of the Meriden and Kirkby Co-operatives was extremely high and beyond the figures placed upon them by the district valuer.
That is a worrying state of affairs that can be illustrated again by the case we considered of the Government leasing buildings in the London area. The parties involved, because they knew that they were dealing with the Government, seemingly were able to extract more favourable terms than would have been obtainable from the market. That is a worrying feature that needs to be considered closely.
Another general area that is important to the PAC and which should be important to the House is the direction in which Government assistance can go. For example, the construction division of W. & C. French Ltd. was tied into a complex arrangement of holding companies. During 1974 the construction company approached the Government and told them that it would not be able to fulfil road system contracts unless it had some payment from the Government. The Government agreed to make an ex-gratia payment of £3·6 million. It became apparent thereafter that the money was used to pay off loans from the holding company to the construction company because the holding company had got into difficulties with its property deals.
It is an absurd state of affairs when public funds are being used to bail out


companies in areas that are different from those which we though we were supporting. I was pleased to note that when we made a second payment to the company the loan was tied specifically to the construction area of the holding companies. It is important that the Government should have the closest possible scrutiny of where funds are going and the purposes for which they are needed. The PAC rightly pointed to the fact that the Highways Act 1959 was used to make this apparently around-the-back-door payment. There was little scrutiny or discussion of the payment in the House.
It is the intention of the Committee to investigate the ways in which public funds are used and ensure that they are usedeffectively. In the work that we undertake, I think we discover areas where there is fat or waste in the public sector. For example, there was the dreadful case of a hospital where land was up for sale for 14 years. That was a realisable asset that was not realised. That is a classic example of what should have been done by the public sector in ridding itself of an asset that it did not need. However, it failed to take that action.
In the Friern Hospital case there was a certain amount of frustration on my part, and no doubt on the part of the Committee in general, when we identified the grossest behaviour by a hospital management team but were unable to identify who was responsible for it. We could not blame anyone, and apparently no action was able to be taken. That backs up the remarks that have been made about the effectiveness of the Committee and how far it can go beyond making recommendations.
I find the PAC an effective body on which to serve. I find the questioning effective and the answers helpful in assisting the public in controlling Government expenditure. Having said that, I repeat that my hon. Friend the Member for Norwich, South made some perceptive observations about the operation of the State audit, which I hope that my hon. Friend the Financial Secretary will bear in mind.

6.15 p.m.

Mr. John Nott (St. Ives): I hope that the House will permit me to intervene

briefly at this stage. My hon. Friend the Member for Epping Forest (Mr. Biggs-Davison) may want to say a few words later on the Fourth Report on Northern Ireland. I hope to keep my remarks relatively brief as I have never had the privilege of serving on the Public Accounts Committee, although I follow its work with great interest, not least the reports that we are now considering.
I echo the words of my right hon. Friend the Member for Taunton (Mr. du Cann), my hon. Friend the Member for Richmond, Yorks (Sir T. Kitson) and those who have spoken from the Government Benches, including the hon. Member for Gloucestershire, West (Mr. Watkinson), in praising not only the work of the Comptroller and Auditor General but the work of the staff of his office.
The PAC, as our most senior Committee, has a most excellent Chairman in the form of my right hon. Friend the Member for Taunton. His speech was thoughtful and constructive and the House owes a great deal to his efforts and those who serve on the Committee, because the House generally and the country are seeking greater efficiency in the public service.
I am glad that we are debating the reports in better time this year. I remember that last year the reports were in some cases debated almost a year beyond the time of their publication. As has been said by others, I am grateful to the Leader of the House for allowing the debate to take place in better time this year. My hon. Friend the Member for Richmond, Yorks said that there would not be enough time to consider the vast areas that are within the purview of the Committee were it to sit every day of the year. However, perhaps I might be permitted to make a few general remarks about the public sector and then slot in some comments about the examples that have been quoted by my right hon. Friend the Member for Taunton as well as some illustrations that are in the reports but to which reference has not yet been made
The public sector—I take this as one guide to its size and scope—now employs about 4·3 million people in public administration alone. It has been increasing by 1 million per decade. There has been an increase of about 1 million in the public sector since 1961, and unless


the trend is reversed—I think it may be—it is likely that the increase will be another million by 1981. We are talking of a public sector that has been increasing rapidly in the past and which is forecast to continue increasing if the trend is not reversed.
Surely everyone in the House will accept that a society like ours that is developing and growing more sophisticated produces an expanding requirement for wider and better developed public services. Clearly the demand for better public services will continue to well up from the country. Other things being equal, that will lead to a larger public service. I hope to be entirely nonpartisan, but surely it is the case that long ago the demand for public sector services—I refer to the services at present performed by the public sector—began to outstretch the capacity of the economy to provide them.
Higher levels of employment in the public sector automatically generate demands for further growth in the public sector and increased expenditure to support those additional people. What is more, as the hon. Member for Stockport, North (Mr. Bennett) said, in the public sector there are no sanctions of redundancy and bankruptcy comparable to those which we know in the private sector. Although the sanction of redundancy extends to a very limited extent into the public sector, it does not have the harshness and severity which are to be found in the private sector. I wish that it were possible for us to invent some better incentives to performance in the public sector on the part of individuals, instead of people moving up the salary scale with their status increasing year by year. The Financial Secretary was a member of the Fulton Committee and I know that that body considered this in some depth. I see all the difficulties, but there would undoubtedly be a great improvement in our public services if we could work more incentive into the system.
The size of the public sector is leading at present to higher public sector deficits. Whatever their party affiliation, I think most hon. Members will agree that the taxable capacity of the country already has been overreached.
Those are some of the wider problems that we face. I shall come to the detailed

points made by hon. Members in a few moments. But the basic question of principle really is whether we should continue on the traditional path in which total Government expenditure and employment have seemed to be generated almost as an accidental outcome of the decisions of individual spending Ministers. They may derive from manifesto commitments resulting from genuine desires on the part of the people as transmitted through the political system by the political parties. Are we to continue along this traditional path of generating more and more spending by the accidental outcome of a multiplicity of desires welling up through the spending Departments, or have we now reached a stage where the total must be controlled and where the overriding policy objective must be that the decisions of individual spending Ministers must conform to that total? I am asking, in other words, whether the decisions of the parts determine the whole, which I think is what has been happening since the war, or whether we now have to reverse the process.
Unless there is to be a change in the traditional way in which we tackle public spending generally, there have to be radical alterations to the way in which we finance the public sector. It may be that, for example, a new swimming pool or sports centre is highly desirable. It may be that in our developed society that is what the community wants, in which case I should not be against the public sector providing it for them. If, however, we are to go on providing more and more services of this kind, they have to become self-financing. If that is the route that we are to follow, it will mean that the education, health and environmental services budgets have all to be charging services—services which charge fees for what they provide—so that there is an element of pricing and the sanction of pricing in the public sector.
I do not believe that we shall go that way. If we attempted to price the services of the public sector, the demand for them would fall away. In the end, people want the maximum of discretionary expenditure. They want money in their pockets to spend on their homes and their families. If we charged for the services of the public sector, it would become clear that ordinary people preferred to have fewer of those services and more


money of their own to spend as they chose.

Mrs. Audrey Wise: Does not the hon. Gentleman accept that, although demand might fall away because people could not afford to pay since they would not have the money in their pockets, that is not the same as need falling away?

Mr. Nott: But the hon. Lady does not appreciate that our resources are finite. I am sure that she works within the constraints of her family budget and income. In the same way, it is necessary for the nation to work within the constraints of its resources and its income.

Mrs. Wise: Putting my family's health and education first, of course—which is all that we are asking the nation to do.

Mr. Nott: I do not think that the hon. Lady has followed my argument. It may be that it was not very well presented. I am saying that if the services of the State go on expanding, bearing in mind that we have reached the limits of our taxable capacity, the only way in which they can be financed is by looking increasingly to charging. That is not a very radical statement.
On the whole, I think that the public services will have to be on an increasingly reduced scale. On the present basis of our spending policies, the National Debt will double in five years and by 1980 payments of interest on the National Debt will fall only a little short of the whole budget of the Department of Social Health and Security. Payments on the National Debt alone will dwarf any of the major programmes such as defence, housing, health or education.

The Financial Secretary to the Treasury (Mr. Robert Sheldon): I am quite fascinated by what the hon. Gentleman is saying. However, I am not sure what it has to do with the PAC reports that we are discussing. It may be that the hon. Gentleman is not greatly interested in them. But there are a number of hon. Members who wish to take part in the debate, and I should be very sorry if they were excluded by matters which could find their place readily in some other debate.

Mr. Nott: It is impertinent of the Financial Secretary to make that comment. If he is incapable of answering some fundamental points, I am very sorry. But I said that I wished to make a few general comments about the scale of public spending before going on to some of the specific matters contained in the reports.
Looking at the scale of public spending, it becomes clear that, unless major reductions are brought about, we shall have to move more and more to a charging system. Therefore, in reducing the scale of our State system we have to look for specific areas, and it is to these that I now wish to turn.
First, there is the traditional rôle of the Public Accounts Committee, which is concerned with the efficiency of the public sector and the elimination of uneconomic functions. I think that the Committee has performed this rôle extremely well over many years. I should like to see this traditional rôle of the Committee extended further, and this brings me very much to the remarks of the hon. Member for Norwich, South (Mr. Garrett) and the hon. Member for Gloucestershire, West about the Exchequer and Audit Department.
I have no personal experience of the workings of the Exchequer and Audit Department. I am quite prepared to believe that it provides an excellent service to the PAC and does a very good job. But I, too, have considerable sympathy with the remarks of the hon. Member for Norwich, South because I feel that the status of the staff of the Department should be enhanced. The comparisons that the hon. Gentleman gave between our Exchequer and Audit Department and the comparable organisation in the United States were very interesting. It has never seemed to me that we have paid enough attention to the enormous influence, power and importance of the Exchequer and Audit Department, and, like the hon. Gentleman, I feel that it needs to be looked at again.
The hon. Member for Stockport, North referred to accounting and accountability in the National Health Service. He also made a point which was not too far removed from the comments made earlier about the Exchequer and Audit Department. It seems to me that the smaller the accounting unit in the public sector,


the better. One does not want to recruit accountants or people pursuing accountancy functions to too low a level in the public service, because this would simply add to the numbers employed. Most hospitals, however, are not accounting units themselves. One wonders whether the accounting unit is not too far up the scale, either at district or area level, and whether more accountability is needed further down in the hospital service. This would make people more cost conscious than they are at present.
I find an echo in what the hon. Member for Stockport, North said about the way in which there has been progress towards the establishment of trading funds in the public service. There are trading funds for the Royal ordnance factories and, I believe, the Royal dockyards, as well as the Royal Mint. This is very useful and could lead to more accountability, which is very desirable. The Public Accounts Committee needs to look very carefully when Governments of any colour put new activities into trading funds. When I was a junior Treasury Minister, I was responsible for the Royal Mint and its activities. It built an extremely excellent new prestige building at Llantrisant in South Wales.
I notice in Opposition that, when that new prestige building, the present Royal Mint, was transferred into a trading fund, the assets were valued at a multiple of the rental values in South Wales. That has involved an enormous write-off in its transfer to the trading funds. In this case, I believe that up to £2 million was involved. Within a very short period that building was built at great expense and was then transferred into a trading fund at a much lower price, and the return on capital employed in the trading fund was therefore affected. I am sure that the Public Accounts Committee watches this sort of thing, but I believe that there is a major rôle for it to play here.
My hon. Friend the Member for Surrey, North-West (Mr. Grylls) referred to the National Enterprise Board. I am not sure of the principle here. I am not sure whether the Board falls into the purview of the Select Committee on Nationalised Industries or of the Public Accounts Committee. This is an interesting point. I am inclined to the view taken by my hon. Friend the Member for Surrey, North-West and also that of my right hon.

Friend the Member for Taunton, the Chairman of the Committee, that the National Enterprise Board is an instrument of the Government and that in that sense it should be subjected to scrutiny by the Public Accounts Committee. It is a question of which particular Select Committee the Board should come under, but I think it should come more within the purview of the Public Accounts Committee than of the Select Committee on Nationalised Industries.
The second area which is vitally important is that where we are dealing with the transfer of activities and assets to the private sector or the hiving-off of assets from the public sector into quasi public sector bodies. The jobcentres saga is particularly interesting. Every hon. Member must have seen jobcentres going up in the High Street of his own town. I am shocked by the large sums of money which are spent on jobcentres and by the figures quoted in the report. Another example of this is the money spent on the Professional and Executive Register and the productivity, if I may call it that, of that particular department. In the private sector an employment agency could not survive for long on the kind of placings which that register has succeeded in making.
The Public Accounts Committee has an enormously important and expanding rôle in informing the House what is going on with items like the jobcentres programme. I hope that the Financial Secretary will refer to this when he replies. There is no point in spending £424 million on jobcentres if these are not helping to place people in jobs. The card index system, which has a traditional rôle in employment agencies, needs to be improved, but in my opinion that £400 million is not money well spent in the public sector.
Thirdly, there is the question of cash ceilings to which my right hon. Friend the Member for Taunton referred. I think that the present Treasury team, led by the Chancellor, has done an excellent job in developing the cash limits system. I believe that the work done in the Treasury in the last 18 months on developing and improving the system has been far reaching. Of course, we have criticisms of the way the system is working and the fact that it did not come in earlier. But this is a vulnerable point for us because


I think we should have brought it in earlier than we did when we were in office. However, this has become infinitely more important with the rates of inflation that we are experiencing now. However, a lot has been done and credit should be given to the Government, and particularly to the Treasury, where it is due.
Two days ago we had dumped upon us the Supplementary Estimates. These amounted to £1·7 billion. I am very unclear why we have Supplementary Estimates of £1·7 billion at this time superimposed on top of cash limits. I have tried to plough my way through the Supplementary Estimates to compare them with the cash limits set down, but it is an impossible job for a Member of Parliament on his own. Therefore, it is vitally important that the PAC should set up some sort of monitoring system to compare, as we go through the year, the cash limits and the Supplementary Estimates which are tipped into the House, involving vast sums of money. Hon. Members simply cannot absorb them.
The total cash spending of the Government's main programmes is about £45·8 billion for 1976–77, of which about £28 billion is covered by cash limits as set out in Cmnd. 6440. Since Cmnd. 6440, the Government have brought more items of expenditure within the cash limits system. That is very relevant to some of the points made by my right hon. Friend. It is very difficult to put cash limits on industrial support, and certainly on regional assistance, but I do not think we should assume that huge blocks of Government expenditure should still be open-ended.
The Scottish Development Agency is, I believe, a useful new mechanism for closing open-ended commitments on regional policy. It involves a set sum of money which can be controlled. With the English regions, by contrast, regional assistance is virtually open-ended and unlimited. I should like the Government to close far more of their open-ended commitments—for example on regional support and regional policies, as well as housing, which I understand they are bringing within the cash limits system—so that the Public Accounts Committee could monitor progress of Government expenditure and compare it with Supplementary Estimates.
Fourthly, there is the question of manpower standards and control. Capital expenditure has taken more and more knocks under this Government. There is an endless deferment of programmes which are being pushed further and further out. Cut-backs in public sector capital expenditure have a devastating impact on the private sector. It is far greater than the impact on the public sector generally. Of course we must be realistic with a budget deficit of this size. For example, although good roads may be extremely important, we cannot describe them as a crucial social priority. Nevertheless, capital expenditure has taken too many knocks under the Government's cuts compared to what I would describe as transfer payments and current spending.
One of my hon. Friends said that the Public Accounts Committee has a rôle in keeping an eye on charging and making sure that charges are indexed to current rises in the cost of living. For example, if we were to reduce the amount spent on prescription charges to the 1971–72 level I estimate that we would save about £23 million in public spending. There is, therefore, a rôle there for the PAC, not to make decisions for the Government but to keep putting before the House the way in which charging is not indexed to inflation.
Finally, however, unless we can get control of current expenditure in the public sector we are lost. Current expenditure is related overwhelmingly to people, to numbers and to the relative price effect—that is, the relationship between what it costs to do something in the public sector and what it costs in the private sector.
That brings me to the House of Commons. Taking health, as an example, do we here need to obtain so much information directly from Ministers and from the Elephant and Castle? Is it not possible to persuade Members of Parliament to obtain more of their information from the regional health authorities? We will never get the numbers down in the central Departments if the demands of Parliament become intolerable. Thousands of civil servants are involved in preparing parliamentary answers, in dealing with Ministers' letters and ministerial briefings, and appearing before Select Committees. Parliament puts an


enormous strain upon civil servant numbers in this way. If it is important to get numbers down, the point will come at which Parliament must call a halt and realise that it cannot have smaller numbers in the public service and still go on demanding such a vast volume of work from the Civil Service.

Mr. Rees-Davies: Does not my hon. Friend do as I do? I send one letter to the district council, a copy to the area authority, another copy to the region and a copy also to the Minister. In that way, when one receives the Minister's reply one is sure that those four know what goes on. That is my practice. Because of the structure of the National Health Service today, it must be done that way if there is to be any co-ordination between the proliferation which exists.

Mr. Nott: My hon. and learned Friend is correct.

Mr. Andrew F. Bennett: Is not the problem with the structure of the National Health Service related to the way in which the Conservatives organised it? Instead of asking parliamentary Questions to which the civil servants get the answers, would it not be better for us, through the Committee structure, to be able to call people in and ask them specifically what they were doing in the way they were running their section or department?

Mr. Nott: I am concerned to preserve parliamentary accountability. Our democracy is based very much on the ability of Members of Parliament to question the Executive, and that goes right down through the system. I am conscious, therefore, that we should not lose this unique ability of being able to inquire, for example, into a surgical operation which took place in a small county town. However, as my hon. and learned Friend said, we must train ourselves better, so that we do not always involve a Minister and central Department civil servants but instead write to the district and the area. We must do more of that in order to help in the central objective which we all share of reducing the numbers of people within the central Departments.
Consider for a moment the revenue Departments. The Inland Revenue, of

which I have had some experience, and the Customs and Excise have grown almost faster than any other Department in central Government. The numbers of people employed in the Inland Revenue could be reduced by tens of thousands if the House of Commons was prepared to accept the abolition of the minor personal allowances. I am talking of the blind allowance and the dependent relative allowance, for example. They are important for individuals, and I do not mean to minimise their importance. But we should find some other way of helping these desirable cases which does not involve the tax system.
Could we not put building society interest on the same basis as life insurance so that it is deducted net and everyone pays a net sum of money after deduction of the basic rate to the building societies? We could get the whole of our income tax system down to two basic questions —"Are you married?" and "Are you over 65?". Those would be the only allowances. There is no reason why the House should not do that. I know, as a former Treasury Minister, that if any Government suggest changing just one personal allowance there is an outcry. But we could reduce the Inland Revenue by 30,000 or 40,000 if we were prepared to bring the whole tax system down to those two simple questions. The whole system would be self-coding and basically one of self-assessment.
The Customs and Excise has expanded far too fast over VAT. It has far too many people. We want to prevent the evasion of tax in indirect taxation, but the numbers have expanded beyond what is necessary. They must be cut down. If the PAC could help to build up all-party pressure, in an entirely nonpartisan sense—this is where the Committee can be so helpful—to try to educate the House of Commons into allowing any Government to simplify the system, we would go a long way to reducing those numbers in the public service and make it infinitely more efficient.
I am sorry if I appear to have taken a great deal of time. I have not dealt with many of the cases in one of the reports, but my hon. Friends will no doubt refer to those matters in detail. I think that the Public Accounts Committee has done an excellent job this year. I look forward to seeing the further work


of the Committee expanded over the next few years in some of the ways I have indicated.

6.51 p.m.

Mr. Frank Hooley: To some extent I share the view of those who have complained that Parliament does not have adequate control over public expenditure. But those who are knocking on the door of the Public Accounts Committee are calling at the wrong place. This House lacks a coherent Committee system. We need a proper system of appropriations as well as an efficient system of audit. The Public Accounts Committee is not designed to keep control over public expenditure.
I want to refer to paragraphs 12 to 17 of the Third Report, dealing with overseas aid. These paragraphs deal with two matters; first, the selection of consultants for overseas aid projects and, secondly, the non-implementation of projects that were found to be viable.
On the selection of consultants, I am inclined to be on the side of the Ministry rather than of the Committee. The Committee suggests that in all cases there should be, as it were, competitive tendering by consultants for particular projects. I think that in this respect it is being excessively pedantic. There is no statutory requirement. The report simply refers to the Ministry's internal instructions on the matter. I find the Ministry's explanation of the process of selecting consultants adequate and satisfactory.
It is absurd that a highly expert group of consultants working in a country should not be allowed to undertake examination of related projects on which it is already working. It is nonsense to have to go through the rigmarole of competitive tendering and the expense of sending a new group of people 3,000 or 7,000 miles to a country when there is a group there already.
The Ministry makes the point that firms may have long standing contacts with certain Governments in particular areas and that it is reasonable that their work in those countries should be expanded without going through the motions of calling in five or six different firms and selecting all over again.
In certain areas we have a vast amount of expertise within public bodies—for

example, in coal mining we have the National Coal Board; in the supply, generation and distribution of electricity we have the Central Electricity Generating Board; and we have expertise within British Gas, the British Railways Board, and so on.
It is not feasible to go looking for consultants in some corner or other when we have this mass of technical, scientific and engineering expertise within these bodies on which we can draw and which can be used to advise developing countries in the development of such services. On that point I am more on the side of the Ministry than of the Public Accounts Committee.
The more important question, however, is what is described as the "non-implementation of projects." The criticism by the Public Accounts Committee is that only about half the projects which consultants had examined and found to be viable were subsequently implemented by the developing countries concerned. The implication by the PAC is that those studies should not have been carried out in the first place, or should not have been paid for by the taxpayer. The suggestion seems to be that the Ministry of Overseas Development should predetermine which feasibility studies ought to be undertaken, on the ground that, presumably, no study, or very few studies, should be undertaken without a castiron guarantee on the part of the poorer country concerned that it would automatically proceed to carry out the project or projects.
It is ironic that in this country there are no doubt scores of viable projects shivering under the poised axe of the Chancellor of the Exchequer, not because there is anything wrong with them or, indeed, because they have not been properly examined, but because we may decide that we cannot afford to carry them out.
The Ministry fairly defends this situation on the ground that we are dealing with independent countries which may or may not wish to carry forward particular projects which they thought a year or two ago were reasonable. The Ministry points out that there may be changes of Government, which occur in this country, changes of Government policy, which again occur occasionally here, and so forth.
The key point in the report is that
in the past two years
there has been
a shortage of funds in the countries concerned.
That is the crucial matter on which I wish to dwell.
The poorer developing countries have been savagely hit by the rise in oil prices, wordwide inflation, and the economic depression that is also afflicting us. I think that the Public Accounts Committee comes to the wrong conclusion when it states that the Ministry should be
more selective in commissioning project studies".
In other words, it should tend to cut down on the technical aid that is given in this way.
To my mind, what is needed is not less technical assistance, not fewer consultant studies where such studies lead to the determination that a project is viable, but more aid. It is silly to use the taxpayers' money to work out, through experts, good viable projects and then not to implement them.
The answer is to provide the cash aid, not to cut the projects. Alas, the record of overseas development assistance from the Western World to developing countries in the past few years has not been terribly good. From the United Kingdom the cash has risen from £150 million in 1961 to £349 million in 1975. Unfortunately, as a proportion of the wealth that we enjoy—the United Kingdom is one of the richest countries in the world—our contribution to overseas aid has gone down from 0·59 per cent. of gross national product in 1961 to 0·52 per cent. in 1964, and finally to 0·38 per cent. in 1975. Therefore, from contributing a little over a halfpenny in the pound of our wealth to the assistance of our poorer brethren, our contribution has sunk towards a farthing and, alas, is still sinking. In public expenditure terms, whereas 15 years ago 2 per cent. of our public expenditure—not GNP—was devoted to aid, it has now fallen to 0·89 per cent.—less than 1 per cent. Therefore, the record is not as happy as I should like to see it.
In terms of the percentage of our wealth which we devote to overseas aid, we have

fallen behind our Common Market partners Belgium, Denmark, France, the Netherlands and Germany; we are way behind the Scandinavian countries, Norway and Sweden; and we are substantially behind some of our Commonwealth partners, such as Australia, Canada and New Zealand. It is no comfort to me that the records of Japan and the United States—two of the most powerful and richest countries in the world—are more scandalous and disgraceful than our own.
It is not as though the needs of the poorest countries have somehow disappeared. Infant mortality in those countries is eight times higher than in the West, life expectancy is one-third lower and 50 per cent. of the poorest people do not receive the proper nutrition for their physical needs. About 750 million people have a per capita income of $100 a year, or about £65. That will go up at the miserable rate of $2 a year unless something drastic is done.
The Public Accounts Committee suggests that the World Bank may provide funds for viable projects if we cannot provide those funds ourselves. It is therefore appropriate to the debate to quote the President of the World Bank, Mr. Robert McNamara, in a remarkable speech in Manila on 4th October 1976. Talking of the poverty of overseas countries, he said:
 The blunt truth is that absolute poverty today is a function of neglect—and of our neglect as much as of anyone's. For we here in this hall represent the governments, and the financial resources, and the international institutions best suited to end the curse of absolute poverty in this century.
Poverty tends to perpetuate itself, and unless a deliberate intervention is designed and launched against its internal dynamics, it will persist and grow.
He went on:
The external assistance needed by the poorest nations over the past few years to achieve reasonable rates of economic growth, and to move towards meeting the basic human needs of their people, has been within the ability of the wealthy world to supply. And it would have been made available had the developed nations met the target, agreed on in the United Nations in 1970, of contributing 0·7 per cent. of their GNP to Official Development Assistance (ODA)—and had 0·2 per cent. out of this been earmarked for programmes benefiting primarily the absolute poor.
The World Bank has a powerful record for its commitments of money to


help the developing world. In the period 1964–68, $2·7 billion was committed. By 1974 the figure was $5·1 billion and by 1976 $6·9 billion. Unfortunately, even these sums are now becoming inadequate and there is a rather disreputable wrangle going on among the richest and most economically powerful countries in the world about increasing the capital resources of the World Bank and its affiliate, the International Development Authority.
Mr. McNamara also stated:
Yet if steps are not taken—and taken promptly—to relieve the resource constraints facing the Bank, this record of growing assistance to the developing nations will come to an abrupt halt and one of the world's principal sources of development finance could find its scale of operations being steadily eroded in real terms.
There is, of course, also the problem of the International Development Authority, which provides the soft grants for projects in developing countries.
Whatever financial constraints are imposed on this country they are not such that we are entitled to neglect the needs of people whose poverty has been set out in such stark words as those used by the President of the World Bank.
I am glad that the Public Accounts Committee has drawn our attention to this aspect of public spending. That it should inquire into the efficient and effective distribution of aid is proper. But I am not sure that I agree with its conclusions. I am more inclined to accept the views of the Ministry on those points. Nevertheless, I accept that it is proper for the Committee to investigate this aspect of public spending to ensure that the money is devoted to good purpose.
But the conclusion that we should draw from the fact that certain projects are not implemented is not that our consultants, experts and technical assistance should be cut back, but that the aid that we give should be sufficient to carry through those projects once they have been found viable by our scientific and engineering experts out there.
I shall give the House a further quotation from Mr. McNamara. He said:
what is beyond the power of any set of statistics to illustrate is the inhuman degradation

the vast majority of these individuals are condemned to because of poverty.
Malnutrition saps their energy, stunts their bodies, and shortens their lives. Illiteracy darkens their minds, and forecloses their futures. Simple, preventable diseases maim and kill their children. Squalor and ugliness pollute and poison their surroundings.
Unfortunately, that is true for far too many human beings.
I welcome the interest that the Committee has taken in the modest expenditure to relieve that situation. The conclusion that we should draw, however, is not that we should cut technical assistance but that we should provide the capital resources to ensure that that assistance comes to fruition.

7.7 p.m.

Mr. John MacGregor: As a former member of the Committee which sat under the chairmanship of my right hon. Friend the Member for Taunton (Mr. du Cann) and as a member of the General Sub-Committee of the Expenditure Committee, I am tempted to stray in depth into some of the issues raised by my right hon. Friend in his excellent opening speech. But I know that many of my hon. Friends wish to speak and I shall, therefore, confine myself to brief remarks on those issues before coming to my main point.
I agree with the general approach taken by my right hon. Friend and I accept a number of the criticisms made by the hon. Member for Norwich, South (Mr. Garrett). I agree with him that the most attractive way for the House to probe and control the Executive is through Committees and not through the work that we do in the Chamber. The Committees are better qualified to do that job. I am doubtful, however, about the suggestion that this should be done by combining the Public Accounts Committee and the Expenditure Committee. The Comptroller and Auditor General, during an inquiry into the Civil Service, was asked about that possibility. He felt that the present staff would not be properly qualified to do the other work with which the Public Expenditure Committee has to deal. That could be put right over a period of time. But the objectives of the two Committees are different and it might be difficult to combine them.
I was interested in the remarks about the monitoring of cash limits. The General Sub-Committee is attempting to set up a system of dealing with that. The Chief Secretary to the Treasury came before the Sub-Committee to discuss cash limits about 18 months ago, and he drew attention to some of the difficulties. We have been looking at this question and I am doubtful whether public accounts procedures are the right ones for Parliament to use to scrutinise cash monitoring. The hon. Member is correct to talk in the way he does about the monitoring of cash limits, and he is even more correct to draw attention to the need for our procedures to be conducted in terms of our scrutiny of public expenditure.
I wish to make only one other general comment on that theme before turning to the specific point which I intend to raise. While the Public Accounts Committee has a large staff—whether it is properly qualified in all respects is another matter—it is extraordinary that the Expenditure Committee, which is carrying out a more up-to-date process, looking at the way expenditure is undertaken in the current year, has practically no staff at all. Whether we combine Committees or, as I would prefer, slightly alter the scope of the Expenditure Committee so as to allow it to do this sort of job, there is no question in my mind but that the Expenditure Committee needs a much larger staff, rather along the lines of the one that my right hon. Friend the Member for Taunton has, if it is to do its job effectively.
I come now to the reports. There are vast and rich seams in these six reports and it is tempting to try to deal with a number of them. This evening I shall concentrate on only one small practical matter, which appears in the Sixth Report at paragraphs 34 and 35. This is a matter to which my right hon. Friend referred in introducing the debate and to which my hon. Friend the Member for St. Ives (Mr. Nott) also addressed himself. It relates to the question of jobcentres.
In paragraph 35 of the report, the Committee came to this conclusion:
We are not yet convinced of the necessity for siting job centres in expensive high street locations.

It went on to recommend:
before the programme of siting up to 1,000 job centres in expensive high street premises becomes too far advanced, the usage of the existing job centres should be carefully analysed so that their cost-effectiveness can be compared with that of modernised employment offices.
I am bound to say that that is right on three grounds. The first is that the jobcentres are costing a great deal of money to set up. If there were 1,000 more, I believe that it would cost about £50,000 for each one, on average, in the first year. Secondly, there is a great deal of criticism about the siting of a number of these offices. My third reason for supporting the comments in the report is that if we look at the objectives of the jobcentres, as given to the Public Accounts Committee and as quoted in the report, we cannot help wondering whether it is necessary for them to be in expensive High Street premises to meet such objectives.
In paragraph 34, the report states that the Department of Employment told it that jobcentres
were designed to expand the Employment Service Agency's share of the labour recruitment market from about 16 per cent., mostly from among the unemployed, by providing"—
this is the key passage—
a better service to employers with vacancies and hy catering for employed people who wished to change jobs and for the special needs of other people such as the disabled.
I wonder whether it is necessary to be in expensive High Street premises to fulfil those objectives.

Mr. Rees-Davies: Far more fundamental than that is the fact that we do not need such centres at all. Why on earth do we want these jobcentres when we have perfectly good agencies that actually charge good money and make a profit out of supplying jobs to all the executive personnel and pretty well all the other people we are concerned with, including the disabled, for whom there are also other organisations?

Mr. MacGregor: I intend to come to that point briefly, although I do not want to take my argument quite as wide as to query whether there should be jobcentres. It is sufficient, in criticising the whole concept, to look at the way it has been carried out. There is a need for job-centres to deal with the unemployed. It


is in the other areas of employment—for example, people moving jobs—that the existence of public agencies should be questioned.
It seems, and the report made this clear, that one of the reasons why the Employment Services Agency had found its ratio of success moving upwards was that it was, in its own words, "marketing vigorously". I suspect that has more to do with it than the siting of the offices. At the time when this report was published, there were 194 jobcentres. That was the figure for May 1976.
This week I asked a Question about where the programme had reached. I asked, in words similar to those used in the PAC report:
what analysis had been undertaken of the usage and cost-effectiveness of existing jobcentres particularly in relation to their siting.
We now find that 264 jobcentres have been opened—another 70 since the report was drawn up. The answer to my Question, given on 7th December, said:
In following up a full-scale exercise into the cost-effectiveness of jobcentres, a pilot study has already been carried out into the comparative running costs of 50 jobcentres and a similar number of employment offices. Fuller research and evaluation, including siting, is to be undertaken in the near future."—[Official Report, 7th December 1976; Vol. 992, c. 175–76.]
It seems that since the Department of Employment appeared before the Committee in May 1976 and since the report was produced in July there has been considerable slowness in following up the recommendation of the PAC on this point.
Since so much public expenditure is involved and since we are all deeply aware—faced as we are with further public expenditure cuts—of the need for cost-effectiveness in every area, I would have thought that there was a need to carry out the study recommended by the PAC before going ahead with the programme of jobcentres on the basis on which it has been undertaken up to now. I reach this conclusion by taking a single example. I do not know whether it is typical, but from one or two other examples of which I have heard I suspect that it is.
This example comes from Norwich. A great deal of public concern is being created among my constituents over a proposal for a jobcentre of 12,000 sq. ft. in an expensive central site. That proposal is before the planning authority. There are two aspects which absolutely confirm the approach of the PAC and which worry me. The first concerns the planning aspect and the advantage that the public sector seems to have here.
There is in Norwich at present potential office accommodation amounting to 1½ million sq. ft. which is vacant or being built or has planning permission, for which compensation would have to be paid if planning permission was refused or withdrawn. There is a total of 1 million sq. ft. of vacant office accommodation in the city. There are three alternative places which I would regard as suitable sites for the jobcentre. Admittedly they are not ground floor situations, but many people believe that they would be just as suitable. These sites have been turned down by the Employment Services Agency because they do not amount to the absolute ideal. What I find astonishing is that when so many others in the private sector are having to accept well below the absolute ideal, here we have the public sector holding out for just that. If the private sector had made an application for this new office block—it is a new block on which work has not yet started—it would have been turned down because of the need to occupy existing vacant accommodation.
My second concern relates to costs. Originally it was thought that the jobcentre would cost £200,000. We now discover that it will be built by a developer and that the question of cost relates to the rental and the length of the lease. It is not possible to discover what amount of public funds is involved because we have no information on the rental and duration of the lease. My suspicion—I receive this impression in other areas too—is that we shall find that the rental is above market values and that the duration of the lease will be pretty long, to enable the developer to have the guarantee to go ahead and build the development. If that is the case the developer is protected, but public funds are once again being used in a way in


which they ought not to be used at present.
A lot more answers are needed on the subject of jobcentres. We have to ask whether they are producing returns in the same way as we ask the private sector to do. Unfortunately there is no criterion by which we can judge them. Private sector agencies go out of business if they move into sites that are too expensive or if they do not do their job effectively. Public sector jobcentres do not need to make a profit. We need a more flexible and imaginative approach by the jobcentres.
In this respect I was interested in a letter in The Times from Lord Teviot, who drew attention to the fact that one jobcentre had been invited to appear in the front hall of Capital Radio in a space 6 ft. by 4 ft. and was doing excellent work, achieving a great deal of success. Lord Teviot added that
This radio station has also taken ESA staff out in their gaily-painted—but frankly elderly—bus, which was bought, I understand, for a couple of hundred pounds or so some time ago, and parked in various shopping centres.
Approaches like that are imaginative, and at a time of need for restraint in public expenditure they are more desirable than the sort of thing that is now going on at Norwich.
I accept that the construction industry is in a terrible state and is anxious to have any new building projects put its way. One does not wish to say that a new building which would help it in my area should not go ahead, but we must be clear on our objectives. If we are to help the industry, let us do so through new factories, schools and so on and not by the creation of another white elephant merely in order to give it jobs.
The example of the jobcentres and the questions raised by the report show our problems as guardians of the public purse. It is difficult to get the answers we need in order to know whether the programme is being carried out effectively and to get control over it if we think that it is not. But at least we should be grateful to the Public Accounts Committee for bringing the matter to our attention, and I hope that as a result it will be possible to get more satisfactory answers about the way in which the programme is proceeding and perhaps to get a change of direction in it altogether.

7.22 p.m.

Mrs. Audrey Wise: I rise to support certain decisions made by the Government, particularly by Ministers in the Department of Industry, which are criticised by the report of the Public Accounts Committee. The decisions are those concerning workers' co-operatives. We are told by the Committee that:
Much public discussion on assistance to industry has revolved around the viability of, and the social costs and benefits associated with, workers' co-operatives.
It is true that workers' co-operatives are particularly interesting and cause discussion, but that is because of their nature and certainly not because of the scale of assistance given to them.
Assistance to industry generally is being given on a huge scale every day, both positively, through grants, and less directly, through generous tax allowances, which I think are of particular benefit to the largest companies. In contrast, the help to the co-operatives has been minimal, involving a sum of £10 million, not all of it by way of grant. I give as an example the Meriden Co-operative, with which I am most familiar. In that case, £4·95 million was made available by way of secured loan and only £750,000 by way of grant. Together, those sums are a large slice of the £10 million that we are talking about.
Not long before the crash which brought about the creation of the workers' co-operative at Meriden, £4½ million of Government money had been given to the private owners in that section of the motor cycle industry, and from subsequent events we know that the money might just as well have been poured down the drain. It did nothing to secure the jobs in, or the continued existence of, the motor cycle industry, but, perhaps because it was given to private enterprise, it was more acceptable in the eyes of some people.
I am not at this moment criticising the general principle of giving grants. I know that among hon. Members there is a great deal of direct experience of the process. Indeed, the Chairman of the Public Accounts Committee, the right hon. Member for Taunton (Mr. du Cann), himself has experience in this matter, because he is a director of Lonrho, and when Lonrho announced that it was buying


Brentford Nylons, with the aid of a Government loan of £4·9 million, he declared, on behalf of Lonrho—

Mr. Rees-Davies: On apoint of order, Mr. Deputy Speaker. How can it be claimed that the Bri-Nylon case has anything to do with the subject before the House? Surely, it is merely intended by the hon. Lady to say something that is unpleasant, although irrelevant to our proceedings.

Mr. Deputy Speaker (Mr. Oscar Murton): I must wait and see how the hon. Lady develops her argument before I can reach a decision on its relevancy.

Mrs. Wise: It is highly relevant, Mr. Deputy Speaker. I am referring to a section of the report which deals with loans and grants made in order to preserve jobs, and the loan made to Lonrho in order to purchase Brentford Nylons was given with that in mind, and I hope it succeeds. The situations are comparable. But one loan was made to a highly profitable private company and another to a workers' co-operative. And it was the latter which was subjected to scathing attack by the Public Accounts Committee.
At the time of the Brentford Nylons loan, the right hon. Member for Taunton said:
We have a perfect right to use the facilities of the Industry Act and the Government is ready to trust us.
Those of us who read the report of the inspectors on Lonrho find that a fascinating statement.

Rear-Admiral Morgan-Giles: Will the hon. Lady confirm that she has carried out the convention of informing my right hon. Friend the Member for Taunton (Mr. du Cann) that she was going to refer to him in the debate?

Mrs. Wise: No, I have not, because I observed that the right hon. Gentleman was opening the debate, and I assumed that he would pay the House the courtesy of remaining to hear it.

Mr. Max Madden: On a point of order, Mr. Deputy Speaker. Will you give the House guidance on this matter, because it has been challenged previously? What is the so-called "convention" of notifying hon. Members?

This point has been raised from one side or the other. In a long debate like this one, even if the Chairman of the Committee concerned is not present—one can understand why—surely an hon. Member is entitled to expect not to have to inform him if he or she wishes to raise points relevant to his Committee's work.

Mr. Deputy Speaker: There is a convention, but no rule.

Mr. Rees-Davies: Further to that point of order, Mr. Deputy Speaker. As it is now plain that the hon. Lady is making nothing but an indirect and despicable attack on my right hon. Friend the Member for Taunton (Mr. du Cann)—who had been present for the debate until only five minutes ago—may I point out that to try to draw a comparison between a co-operative, receiving public money, and Lonhro, dealing with Bri-Nylon and entirely private assets, has no relevance to the debate, but is being introduced by the hon. Lady in order to be beastly, and should be withdrawn?

Mrs. Wise: It was public money that went to Brentford Nylons.

Mr. Deputy Speaker: Order. This is a matter not of order but for debate.

Mrs. Wise: Thank you for that ruling, Mr. Deputy Speaker. I am interested in the case of Lonrho and Brentford Nylons because the amount involved was public money. I regret that the hon. and learned Member for Thanet, West (Mr. Rees-Davies) is not really acquainted with the way in which public money is being spent.

Rear-Admiral Morgan-Giles: On a point of order, Mr. Deputy Speaker. I apologise for interrupting again, but do I interpret your ruling correctly as being that this is just a matter of courtesy and good taste?

Mr. Deputy Speaker: That is what I indicated. There is a convention, but no rule.

Mrs. Wise: There is no lack of courtesy in an hon. Member assuming that the opener of a debate will be present to hear that debate. I have been present during the greater part of it and I have seen very little of the right hon. Member for Taunton.

Mr. Costain: That really is a most inaccurate statement. I have been here for the whole of the debate and it was only when reference was made to my right hon. Friend the Member for Taunton (Mr. du Cann) that I noticed that he was missing. He has been sitting in his place throughout. Surely the opener of a debate is entitled to have a cup of tea sometimes. I have been foolish enough to sit here throughout the debate and I have not managed to catch Mr. Speaker's eye.

Mrs. Wise: I said nothing offensive about the right hon. Member for Taunton. I merely quoted something that he said, and I stated that those of us who have read the Lonrho Report will find the statement fascinating. That is well within the rules of parliamentary order. I can only conclude that certain hon. Members are finding that a certain cap fits. They are responsible——

Mr. Deputy Speaker: Order. It would be in the best interest of the House and good temper if this aspect of the matter were passed over and the hon. Lady were now to continue with her speech.

Mrs. Wise: It may be that hon. Members on the Opposition Benches have succeeded in their desire to take my mind from the defence of workers' co-operatives and focus it more clearly and closely on the affairs of Lonrho, when I intended nothing more than a passing reference to it. I repeat; there has been nothing at all offensive in any comment that I have made about the right hon. Member for Taunton, who has himself informed the House that he is very proud to be a director of Lonrho.
I should like to turn now to the criticism that the Public Accounts Committee has made about the Crown Agents. In its Third Report it drew the attention of the House to a situation that had been brewing up over the Crown Agents throughout the time when the Conservative Party were in government—a situation that was inherited by Labour Ministers. According to the Third Report, in late 1974 the newly appointed Chairman of the Crown Agents informed the Government that
The book value of their assets might need to be written down substantially giving rise to a capital deficit of £44 million at the end

of 1974, and that they expected interest losses of about £11 million in the period to 30th June 1975. They thus needed £85 million to restore solvency and to provide a capital reserve of £30 million.
That is a substantial sum—£85 million. That is eight and a half times the amount involved in the discussion on workers' co-operatives. And what had the Crown Agents been doing? They
had been advancing substantial sums to secondary banks and property companies.
The Public Accounts Committee does not show a proper sense of proportion in devoting about the same amount of space and time to that mater as to the workers' co-operatives, and it makes infinitely more scathing criticisms of workers' co-operatives.
I turn in detail to the critimisms that have been made.

Mr. David Crouch: I was a member of the Committee. The hon. Member for Coventry, South-West (Mrs. Wise) seems to be suggesting to the House that she is not aware that this is a parliamentary Committee, a Select Committee, an all-party Committee. It is not examining one aspect of a mistake in Government expenditure by one Department or another in any party sense, but in a parliamentary sense. There is no question of the Committee's suggesting in its report that it is directing more attention to or criticism of the co-operatives than it is in the case of the Crown Agents. The criticism of the Crown Agents was very severe indeed.

Mrs. Wise: I am at a loss to understand the meaning of the hon. Member's intetrvention. Nothing that I said could me interpreted as meaning that the Committee was criticising in a partisan way. I was simply suggesting that the whole Committee, in the absence of evidence to the contrary, was not displaying a proper sense of proportion. About eight and a half times the amount of money was involved in and lost by the Crown Agents, compared with the amount involved—not lost—in dealing with workers' co-operatives. I am calling into question the Committee's sense of proportion, not its party composition.
I am determined to turn now to the detailed criticisms which have been made about workers' co-operatives, however many times Opposition Members interrupt. The Committee expressed surprise


that the prices paid at Meriden for land, buildings and machinery were greater than the district valuer's open market valuation. I think it is a pity that the amount was greater than the district valuer's open market valuation, and so, no doubt, do all those concerned with the co-operative. But there is more to striking a bargain than the wishes of the purchasers, as we all know.
At Meriden, a private financier gained control of this important section of our industry, seeking, I regret to say, to make money rather than to make motor cycles. This financier gained control of the British motor cycle industry and then sought to close down this factory, which employed a considerable number of workers, many of whom live in my constituency.
The workers were not disposed to accept this, and they decided to defend the existence of this factory and their jobs with it. When they had shown extraordinary tenacity in this defence, the owner of the land and plant decided to sell and to try to get the best value that he could. I am not criticising him, as he was acting perfectly in accord with the ethics of the economic system in which we live, which I do not support but which Opposition Members do.
These purchases of land and plant were made to keep a British motor cycle industry in being, not for speculation or scrap but for use. In considering the question of the price paid, I quote from the Sixth Report:
The Department informed us that although they left negotiations to the co-operatives so as to avoid becoming too closely involved in the management of the projects, in all the circumstances they were satisfied that the settlements reached were reasonable and defensible. In their view the co-operatives had an incentive to negotiate the lowest possible prices because they had to operate within an agreed level of Government support and it was in their interests to minimise all calls on their available funds.
That sounds to me like an eminently sensible statement, and it is a sensible attitude for the Department of Industry to take. But I do not know what I am to make of the following extract from the Sixth Report:
In Your Committee's view however any constraints imposed by the overall limit of available assistance were more than offset by

the co-operatives' lack of alternative choice of locations and by the severe pressures upon them to restart production as soon as possible.
The whole point is that here, in this location, was a motor cycle factory, suitably fitted up and equipped, with a highly skilled work force in the vicinity, all anxious to continue working there. It was of more value to the prospective workers' co-operative than it would have been to some mythical non-existent purchaser for some unknown purpose on the open market. The use which can be made of a location has a distinct bearing on the value of that property to a particular purchaser. I do not believe that there is any such thing as a simple and abstract value. I am astonished that the Public Accounts Committee should take such a mechanistic and unrealistic view.
Of course the co-operative wanted to restart production as soon as possible. I am sure that my constituents, the residents of Coventry and Meriden, and most of the population of the country would think that a worthy objective. For those geared to a system in which it can be profitable to keep premises empty it might be difficult to understand the simple reasoning behind my statements. Those who accept the reasonableness of the profits so disgracefully made from Centre Point by keeping it unused and empty will find it hard to grasp that it is reasonable to seek to restart production and is therefore possibly worth paying a little more to enable this to happen and to prevent the loss of sales of motor cycles. The Public Accounts Committee, in making these criticisms, has shown itself to be rather short of common sense.

Rear-Admiral Morgan-Giles: I am sure that the hon. Lady is trying to be fair. There is an NVT distribution centre in my constituency. I understand that the firm, which was in considerable difficulties, was advised by consultants that the only way it could remain profitable, continue to make motor cycles for export and provide employment was by rationalising and reducing the number of factories from three to two. That meant closing one factory. That is very much at variance with what the hon. Lady is saying. I hope that she will agree that that is what happened.

Mrs. Wise: No, it is not at variance with what I am saying. I accept that an action looked at from one point of view can be described as rationalising, and can involve cutting jobs. That is the way much of our economy is run. I cannot accept, however, that such action would lead to the maintenance of a viable motor cycle industry, nor can I accept that my constituents and the residents of Meriden should have been expected to facilitate the running down of their factory to preserve the profitability of the company when they considered that the motor cycle industry could continue and even expand if properly run and managed.

Rear-Admiral Morgan-Giles: What has happened now?

Mrs. Wise: What has happened now is that the remaining private section has continued to go the way it was previously going, whereas Meriden has succeeded in continuing to produce motor cycles. I intend to comment on the current position in a moment.
The Public Accounts Committee went further and said:
We are not, therefore, convinced that the prices paid were wholly reasonable even though they may have been the lowest that the co-operatives could negotiate in the circumstances.
The only conclusion that I can draw from that statement is the implication that it would have been rational and sensible to allow the factory to close. I am very pleased that the Government and the Ministers in the Department of Industry did not look at the matter in that way. They made sensible decisions, in terms of keeping the motor cycle industry going, maintaining jobs and agreeing to the proper use of public funds.
The greatest waste lies in paying people for doing nothing. To use money to back people who have shown their involvement and their intense enthusiasm for the work they are doing shows imagination and good sense. I should like that imagination and good sense to be repeated more often by all Governments.
I have concentrated my remarks on the Meriden Co-operative because it is the one with which I am best acquainted. The statements made by the Public

Accounts Committee about workers' co-operatives in general are misguided, unfounded and extremely unfortunate. I hope that the Government will not be deterred from continuing to give assistance to workers' co-operatives where it is justified. It is one of the most useful and progressive purposes for which public money can be expended.
With NVT in liquidation, Meriden is now the only remaining part of the British motor cycle industry. If Meriden goes, we shall have no motor cycle industry. The collapse of NVT has added to the problems that Meriden was bound to face. As this matter is outside the control of the Meriden workers, I trust that nothing that may arise from it will be used as a justification for jeopardising the future prosperity of Meriden.
We have in Meriden a work force that has proved beyond doubt that it can produce motor cycles. All the objectives that are usually held out to workers have been achieved. There has been an improvement in productivity, the product has improved, and so has the assembly of the engines. On such matters as oil seals and other mysteries on which I am not an expert, but on which the workers are, I understand that the workers' suggestions and interest have led directly to improvements in the motor cycles being manufactured at Meriden.
Such utilisation of the talents and interests of the workers sets an example which I hope will be followed in all manufacturing industry. Compared to the good which has been done, and which I trust will continue to be done with the co-operation of the Government, any problems there may be should pale into insignificance. Instead of criticising the Government for their actions, the Public Accounts Committee should have congratulated them.

7.47 p.m.

Mr. John Biggs-Davison: I am quite prepared to believe that the hon. Member for Coventry, South-West (Mrs. Wise) does not know when she is being discourteous and partisan, but I thought that she was particularly ungracious to my right hon. Friend the Member for Taunton (Mr. du Cann), who at the beginning of his speech expressed sympathy with the idea of workers' co-operatives. I, too, support the


idea of workers' co-operatives and of helping workers' co-operatives, provided that they can also help themselves. That is a purely personal opinion, and I must stick to my last and I want to be brief.
My right hon. Friend the Member for Taunton in his impressive opening speech praised the diligence and expertise of the Comptroller and Auditor General for Northern Ireland. I echo his words. I do not serve on the Public Accounts Committee, but I have studied its admirable work on Northern Ireland. I gather from the Fourth Report that a favourable impression was also formed of the professional skill of the officials with whom the Public Accounts Committee dealt. I noted the observation made by my hon. Friend the Member for Canterbury (Mr. Crouch), and recorded in the report of the evidence on the then newly-appointed Permanent Secretary at the Northern Ireland Department of the Environment.
The public service in Northern Ireland operates in circumstances of difficulty and danger and has borne casualties. Judith Cook was murdered on duty a year ago. Public servants' homes have been attacked, and they have been murderously threatened. But these men and women quietly, and for the most part anonymously, work and maintain the machinery of government. In such trying conditions the Civil Service has its work cut out to budget accurately.
Paragraph 64 in the Fourth Report states that the Department of the Environment seriously underestimated the effects of inflation in costing the new Belfast Central Railway. It is difficult to blame officials since serious underestimates of the effects of inflation are characteristic of present Ministers. Paragraph 66 in the Fourth Report suggests that the loss in connection with the Belfast Central Railway could be made good by the disposal of lands and property. I hope that in due course we may hear what progress has been made.
In paragraph 29 of the Fourth Report, referring to the case of a Norwegian company, concern is expressed by the Committee that the Department of Commerce had been unduly influenced by
considerations outside the immediate field of commercial judgment.
This, as the Committee pointed out, is a recurring problem. Departments take

their lead from what they understand to be the policies of Ministers. The Department was concerned, as the report says,
to create and maintain a nucleus of skilled male employment in Londonderry".
Hon. Members know that the wage-earning breadwinners in Londonderry are often women, so this is a laudable aim, but it is arguable that workers in Northern Ireland could be served best by projects that have some prospects of profit. That might be a more productive use of public funds.
I share the Committee's concern that housing finance in Northern Ireland should be rationalised as soon as possible. The Government have published proposals, and there is evidence that a substantial increase in rents in both private and public sector housing is inevitable.
The report of the Housing Executive has been laid before the House. Its Chairman, Mr. James O'Hara, has said that tenants can expect increases of more than 60p a week. Squatting is a growing evil, and we await the Government's proposals for changes in the law.
Since the Fourth Report was brought out, the Under-Secretary of State for the Northern Ireland Office said in a Written Answer to me:
The amount of rent and rates owed to the Northern Ireland Housing Executive at 30th September 1976 was approximately £5·6 million. Rate arrears in the private sector at the end of the financial year 1975–76 stood at £4·4 million; a precise figure for the financial year 1976–77 will not be available until next year."—[Official Report, 7th December 1976; Vol. 922 c. 145.]
This is a matter of concern to the PAC. It is disturbing and unsatisfactory, and no doubt we shall return to it on a suitable occasion.

7.53 p.m.

Mr. W. R. Rees-Davies: I want to make a point about the aspects of the National Health Service commented on in the Sixth Report. The admirable work of the PAC, as set out in the report, clearly shows that substantial cuts could be made in the NHS in particular fields. It also shows that there is considerable inefficiency in the NHS which could be easily remedied.
I have started by giving conclusions and I should like to develop them. The House is fortunate to have a Chairman of the Public Accounts Committee with


the ability and calibre of my right hon. Friend the Member for Taunton (Mr. du Cann). He has unrivalled and outstanding commercial knowledge. It is clear from the reports that he is an interrogator of no mean order, and as a cross-examiner he would have made a first-class "silk" at the Bar. He is ably backed up by my hon. Friends the Members for Folkestone and Hythe (Mr. Costain), Canterbury (Mr. Crouch) and Richmond, Yorks (Sir T. Kitson). They have done a great deal of admirable work.
The PAC should be extended and developed into special Committees and, although I do not have experience to express an opinion, I think that its work might be extended. It is certainly of the greatest value to the House and country, and a great deal more should be made known about the Committee's work.
May I, as a cross-examiner earning my livelihood out of the art of interrogation, make one tiny criticism. The matter with which I wish to deal is included in the Sixth Report of the PAC from column 2925 page 417 to column 2972 on page 424. It is well known that the art of interrogation involves dealing with persons who often wish to avoid or evade the questions. Unfortunately, the Permanent Secretary who was being questioned is a master in the art of failing to answer.
Here are the first-class questions that were put by the Chairman of the PAC, my right hon. Friend the Member for Taunton. He asked the Permanent Secretary:
Can you tell the Committee by how much manpower in the Health Service has increased over recent years?
The Permanent Secretary replied:
I am afraid that I have not got that statistic at my fingertips".
He promised that the answer would be supplied, but it never was. Later he was asked by my right hon. Friend:
Can you tell us how the figures of bed occupancy have varied over the years?
The Permanent Secretary replied:
I can certainly provide that figure".
But he never did.
He was then asked by my hon. Friend the Member for Folkestone and Hythe:
Have you any idea of what the regions cost?

My hon. Friend was, of course, referring to regional health authorities, and he was told by the Permanent Secretary:
I am afraid that I cannot quote a figure, but if I might include that in the note the Chairman has asked for I will do so.
A note at the bottom of the page in the report indicates that this note never appeared.
My hon. Friend the Member for Richmond, Yorks said that he had tried to discover who had made a decision about stopping an ambulance from collecting somebody. It had taken him 11 telephone calls to find the man who had made the decision.
My hon. Friend went on to inquire about staffing. He asked:
How are you going to set out the staffings, in comparison with, say, 1st April 1974?
That was the position which had obtained until the reorganisation of the NHS. The Permanent Secretary replied:
I think that we shall have to try and set them out in terms of post approval, if that is the right word, or post established and not necessarily post filled, on the reorganisation on 1st April 1974".
That was one of the really important questions. Figures were asked for and were never supplied. I have now put down Written Questions about these figures, and I hope that the answers will be supplied. They should provide valuable information, giving us a general picture of the NHS.
The Department of Health and Social Security spends the staggering figure of over £4,000 million a year. The reorganisation of the NHS established 14 regions, about 90 county areas and 200 districts. If we can cut these, as I am sure we can, by about 5 per cent., that will reduce costs by £200 million. That could be done by the immediate removal of the 90 area authorities which are not carrying out any useful purpose, as I shall prove.
It would be necessary for a few area administrators to be absorbed into the regional tier so that they could look after particular counties, but no valuable purpose is being achived by the area authorities. The work done by the districts is sufficient.
It is a waste of time hon. Members writing to the Minister, because the Ministry does not know what is going


on at district level. The Ministry writes to the region, the region writes to the area, the area writes to the district and the district gets in touch with the general practitioner or the people concerned locally such as the community health council. In all my recent investigations, which have been fairly extensive, I have always sent seven letters.
I can give as one example a problem which was identified by the Public Accounts Committee. I recently had to deal with the problem of an elderly lady suffering a severe cataract. To my horror, I was told that in Thanet and, indeed, throughout East Kent there was a two-year delay before the lady could have an appointment to have her eyes examined. I found out from Mr. Darvell, the only ophthalmologist in the Thanet area, that that information was true. As a result of my intervention, the lady got her appointment the following week and had the operation, although, as Mr. Darvell rightly pointed out, this meant that someone else would have to wait longer.
I wrote to the Ministry, and the Minister of State replied:
There is a two year delay for all routine cases. In exceptional cases, Mr. Darvell will see a patient otherwise… As far as the general situation is concerned, there has only, I understand, ever been one consultant ophthalmologist for Thanet—the Canterbury and Thanet will have an additional one in their programme next year.
That statement was quite untrue. There were two ophthalmolgists, but one emigrated and has not been replaced, which is hardly surprising considering the overload of work. There is only one consultant now, but when I asked whether another was to be appointed I was told that this was a matter not for the Ministry but for the regional authority.
From then on I sent one letter to the Ministry, one to the region, one to the area, one to the district, one to the consultant, one to the consultant's advisers and one to the patient concerned. If one wants to get anything done in the NHS it is necessary to go through all these people, but they do not undertake different tasks. The administrator at regional level is doing almost an identical task to the administrator at area level, who is doing a similar task to that performed by

the administrator at district level. That is how we get this build-up of tiers.
It was profoundly true when the Permanent Under-Secretary told the PAC:
I have been made very conscious in my discussions during visits, whether when talking to a district management team or talking to the staff representatives from hospitals, of this feeling that they put very vividly to me of having a great many tiers above them.
He can say that again. I have talked extensively to consultants and GPs, and they find it impossible to know what is going on or to get through to the Ministry. The Ministry is not often in touch with the regions, and the regions do not know what goes on in the areas. The area has to get in touch with the district. We need a surgical operation to remove the area level. The patient would at least then have the opportunity to reach an understanding with the district authority.
Having been told that the provision of more ophthalmologists in East Kent was a matter for the region, I wrote to that authority and was told that it was not a matter for the region. I was referred to the Kent Area Health Authority and was finally told:
With regard to ophthalmologists in Thanet, I can confirm that Mr. Crawford has been replaced"—
that is the man who emigrated—
and the waiting time for any patient's treatment can be up to two years. This is very largely due to the lack of in-patient beds in the district.
The letter went on to say that the authority would like to have the capital resources to provide a new unit in Canterbury, but the letter was so complacent as to be almost unbelievable. It said that there was a two-year delay for treatment but offered no kind of proposal to do something about the problem.
The letter also said that there were no beds, and I thought that it would be a good idea to find out whether there were any beds. I sought the bed occupancy rates in local hospitals and was told that at Princess Mary Hospital in Margate the occupancy rate had fallen to 46 per cent., at Margate General Hospital it was 70 per cent. and in the others it was about 80 per cent. There is an abundance of beds. There may not be the staff, although there are plenty of administrators. We are facing a serious situation, and we


need this surgical operation to cut out the administrators and increase the medical staff. I understand that the same picture exists in other counties. We must try to secure more consultants and staff, who are really needed in the NHS.
There was a rumour that Princess Mary Hospital was to be closed. I asked at district level and was told that the authority knew nothing about it. The area authority told me that it had no knowledge of any such proposal. Eventually the regional authority gave me a first-class categoric reply that there was no such plan and that if a proposal were made it would be dealt with in the usual way and there would be full consultations.
How can the ordinary person understand a system in which there are four separate channels of communication—district, area, region and Ministry? Seven bodies would be involved in any consultation, to include community health councils, doctors and nurses and other hospital staff would also have to be consulted. It is sheer bedlam.

Mr. Andrew F. Bennett: Will the hon. and learned Gentleman give way?

Mr. Rees-Davies: It is no good the hon. Member for Stockport, North (Mr. Bennett) trying to intervene to make a party point. I shall make it for him. This system was set up by a Tory Government. I have given the hon. Gentleman his point. It was set up by a Tory Government, and it is sheer idiocy. The PAC tries to obtain an objective, all-party view of what is going on.

Mr. Andrew F. Bennett: I certainly wanted to make the point that it is a pity that the Conservative Party did not appreciate the problems it was causing when it was reorganising the National Health Service. One must be careful not to keep people in a continuous state of reorganisation so that one does not find out all that ought to be happening. One of the points made by the report was that the Committee could not pursue its inquiries too far because the NHS was in a state of reorganisation.

Mr. Rees-Davies: I recognise the point made by the Permanent Secretary when giving a very poor defence and a half-hearted reply, indicating plainly that

his idea was that one should give the new NHS structure a chance.
No one who thinks seriously for a moment that one can live with this kind of structure, has any business sense or any sense at all. Anyone who tries to operate it must make six or seven copies of every single letter that goes out. There is yet another line of communication. There is also the medical officer for the region. If one writes to the region, it is a waste of time to write to Sir John Donne unless one writes to Dr. Porter, the regional medical officer, who is brought into the picture too. The postage is enormous.
I now wish to discuss the impossibility of getting a decision on hospital services. First, I shall deal with casualty departments. I am sure that what I am saying about Kent is true elsewhere. For 10 years we have been trying to get an improved casualty department at the Margate General Hospital. We were given a figure on cost but the figure escalated, as did the building cost. First, the doctors and nurses blew their tops and said that they really must have something done. I wrote to the Ministry, which said that it was a matter for the region. I wrote to the region, and the region said that it had passed it on to the Kent area. I wrote to the area, which said that it had passed it on to the district. I wrote one letter to Kent asking "Do you or do you not accept that it is your decision?" I received two letters, one from the deputy administrator, who said that it was not a decision for the area, and one from the administrator saying that it was a decision for the area.
What can one do in this situation? It is a deadly serious matter. In the end, I wrote to say that I wanted to see an absolutely firm recommendation to the region that this was priority number one. I wrote to ask the region to give a decision before Christmas that the casualty department could go ahead and to say that it had the money. The area replied "Ah, but it is subject to ready availability of cash".
If it is first priority, there must be some cash available. We are dealing here with projects of under £350,000. Therefore, one has to be able to make plain, if one is to have different authorities, exactly


which powers to decide belong to which authority.
I do not want the region to have to decide this matter. The district must make the general and broad decision among competing claims. I want to keep the regions because—God forbid—if the matter should go to the Ministry, the Ministry does not seem to have any understanding of local requirements. It is no good arguing for the retention of county authorities. One will not get the money, because the money will only go to the regions. We should keep the 14 regions, get rid of the 90 county authorities and keep the 200 district councils.
There are one or two men who are useful at Kent area level, but if those men went into the region one could reduce the regional staff accordingly. I am told that this would produce a reduction of 4 to 5 per cent., which would cost £150 million to £200 million less. A decision must be taken.
I criticise Sir John Donne, who as far as I can see is incapable of taking any decision at all. The matter must be fought hard. The doctors are upset about the situation, and morale in the NHS in the area is appalling. There is now little leadership within the Service, and it behoves Members of Parliament throughout the country to enter the fray. Because of the way in which local authorities are organised, few people now understand the structure of the NHS.
We are looking forward to the establishment of a new operating theatre in the Royal Sea Bathing Hospital at Margate. We know that Canterbury is seeking similar facilities. A decision must be made on this matter. But has it ever been made? In June 1975 the then Minister of State, Department of Health and Social Security the right hon. Member for Plymouth, Devonport (Dr. Owen) came to Thanet at the time of the referendum, and we understood that we would have a decision from the Department about the operating theatre in Margate. I was not aware at the time that Canterbury had equal priority. Although that visit took place in June 1975, we have still not had a decision. Nobody in the Department, region, area or district had taken a decision. Surely the proper people to have taken that decision were

those in Canterbury and Thanet District Council. It may well be right that Canterbury should have these facilities first, and it may well be that Canterbury will get them. I see that my hon. Friend the Member for Canterbury (Mr. Crouch) is present——

Mr. Crouch: I am not saying a word.

Mr. Rees-Davies: My hon. Friend is not saying a word, and I do not blame him. Surely we should have had a decision on the operating theatre within a year or two of the Minister's visit to Thanet. It appears that we shall not have two such theatres in the area because we cannot afford them, but we should decide at district level where the theatre is to be situated. A decision one way or the other must be taken. We are still awaiting the outcome of all these considerations, and there has been the usual kerfuffle with matters passing from the Department down to the region. We are fobbed off, however, with the excuse that nobody knows what figure is to be spent next year.
I hope that what I have said has been constructive. I hope that we shall cut out the area and have a clear decision. I serve notice that, if anyone in these bodies gives me an answer to the effect that he does not know what is happening, I shall immediately seek to raise the matter on the Adjournment. I shall be after him in his job, and I shall pursue the matter to the end.

8.19 p.m.

Rev. Ian Paisley: The House is grateful to the Chairman and members of the Public Accounts Committee for all their work as represented in these reports. We are particularly grateful to the Chairman of the Committee, the right hon. Member for Taunton (Mr. du Cann), for giving an able analysis of the Committee's work.
I wish to deal briefly with some of the matters mentioned in the report on the subject of Northern Ireland. The Committee examined a number of operations which had their origin in the work of the old Stormont Parliament. Then the Stormont Parliament was prorogued, and in the interim period there was no public scrutiny of spending by Government Departments in Northern Ireland.
I speak as a former Chairman of the Public Accounts Committee in Stormont.


It is to be regretted that in that interim period certain operations were commenced, the direct results of which the PAC of this House is now having to examine.
We are also dealing with some matters begun by the ill-fated Executive. I have no obituary to write for that body. I should like to express the gratitude of the people of Northern Ireland for the able way in which the Chairman and members of the Committee dealt with those matters. I fully endorse what the right hon. Member for Taunton and the Opposition spokesman on Northern Ireland, the hon. Member for Epping Forest (Mr. Biggs-Davison) have said about the Comptroller and Auditor-General of Northern Ireland and his staff. They deserve the warmest possible thanks of the people of Northern Ireland.
As a Northern Ireland Member, I recognise the need for the closest possible scrutiny of what is happening in Government Departments in Northern Ireland. The Fourth Report of the PAC says, in paragraph 8:
we are of opinion that DHSS failed to take effective action as early as it should have done
in a matter concerning Giro cheques. This matter was raised by my hon. Friend the Member for Belfast, South (Mr. Bradford).
Some hon. Members get very hot under the collar about money for the Provisional IRA coming from the United States of America and other places, but if not one penny piece came from America to the IRA, it would remain a fact that the IRA is being financed by a vicious conspiracy in the manipulation of Government funds to thier own ends. That has now been exposed in the Housing Executive, where the Fraud Squad has been called it. About £3 million is involved, much of which, if we are to believe the reports that are circulating—I exposed this situation in the House many months ago—went to a company whose managing director is on the brigade staff of the Provisional IRA.
In the Giro cheque scandal, —133,000 was found to be missing for a calendar year ending July 1975. I congratulate the PAC and its Chairman on their close scrutiny, which has revealed that part of the fraud was inside the Post Office.

Then, most of the cashing of the cheques took place in West Belfast, which is practically under Provisional IRA control. So what my hon. Friend the Member for Belfast, South insisted on—it was pooh-poohed by the then Secretary of State for Northern Ireland—has now been exposed by the PAC and should be carefully considered by every hon. Member. It is a most serious matter when the taxpayers' money is used to purchase bullets to shoot members of the defence forces and Her Majesty's security forces.
I congratulate the Committee. It is about time that this House saw to it that a representative from Northern Ireland was appointed to the Committee, so that this matter and other matters could be really gone into by someone who is on the spot and knows exactly what is happening in Northern Ireland. I do not mind who is appointed, but someone from Northern Ireland has a right to bring forward matters that we know about in Northern Ireland.
Then there is the matter of the constitutional stoppage, which need never have taken place if the House had listened to the voice of the ballot box. But when it did take place, what did the then Minister of Health in the Executive do? Incidentally, I understand that there will be Assemblies in other places, although this great nation of England is not to have such an Assembly, for some reason or other. Perhaps it can rule this country only if aided by the Ulstermen, by the Scots and by the Welsh—and is not fit—although it has given self-government to many nations—to rule itself. That may be the conclusion to be drawn. What I wanted to say was that in the crisis the then SDLP Minister of Health pulled down all the safeguards.
The Committee, in its Fourth Report, at paragraph 10,
noted the essential simplicity of the emergency scheme".
That is one of the best sentences in the report. It is written with a fine sense of irony. The report also refers to
the inevitability that most of the usual safeguards had to be abandoned while it was in operation.
Public money was put forth and practically every safeguard abandoned. A constituent of mine was amazed, during the constitutional stoppage, to receive a


Giro cheque for an amount of money that he had not claimed. This took place in Northern Ireland.

Mr. McCusker: Did he return it?

Rev. Ian Paisley: He did return it. He was an honest man, and he was advised by his Member to return it. I hope that the hon. Gentleman would give similar advice to those in his constituency. The Department is making an investigation into what might happen if such a constitutional stoppage took place again. Perhaps the Minister, in his reply, will tell us how far this investigation has gone.
We have the amazing situation of public money paid out to Queen's University Library for library facilities relating to health and social services. A sum of £83,000 was paid out to the university, which the university did not spend for the year in which it was paid out.
Very rightly the Committee drew attention to the fact that there is a principle—I should have thought that the Department in Northern Ireland ought to know about it—that public money should not be made available before it is required. But evidently that public money was handed out before it was required. I do not know whether this sum of £83,000 was invested, or what interest came in from it. It is an interesting point, and I am sure that the Minister will be able to help us on it this evening.
With regard to the Housing Executive, staggering figures have been revealed this evening about rents and rates. There was a rent and rates strike, which was inaugurated by the SDLP. That party told its people that they would never need to pay any rent or rates which were withheld. These poor people believed the SDLP. Now they are unwilling to pay back what they have withheld.
The Housing Executive finds itself in great difficulty. As I left the Executive's offices after seeing the Director General on the last occasion, the chief of the Fraud Squad was coming in to have a look at the books. As I mentioned at the beginning of my speech, vast sums of money have gone to the coffers of the Provisional IRA. Surely there is a need for the Committee to continue its scrutiny

of the work of the various Departments in Northern Ireland.
My next point concerns the recreation centres. The idea was put forward with great enthusiasm from all parts of the House. It was said "If only we build great recreation centres for the people of Northern Ireland, all will be well. The bombing and the shooting will be over, and all will be well." That is the sort of nonsense that has been spoken in the House.
I remember leaving this House on the day when Stormont was prorogued. A Member said "It is all over now. Peace has come." I said "What you have seen has been a Sunday school picnic compared with what will take place as a result of the folly of the House of Commons." The House, having sown the wind, has reaped the whirlwind. I am delighted that on the last occasion that the matter was raised in the House the Government told us that they had changed their mind about the whole programme.
This brings me to the question of the Belfast Central Railway Station and the whole reorganisation of transport. If we go to Belfast we see a huge sports and leisure centre being built on one side and the new railway station on the other. Between the two buildings are two Provisional strongholds——the Shortstrand on one side and the Markets on the other. When the expenditure has been completed, we shall hear the same type of loud explosion that was heard when the gasworks were blown up. That explosion will mean that the two buildings will have gone. Given the area in which the building has taken place, it will be almost impossible for the security forces to cover it.
I am glad that the PAC has underscored the fact that there must be a strengthening of financial control in these matters by the Department of the Environment. It is important that the Government Department responsible has a firm grip on how the money is spent. Surely that is relevant to the Belfast Central Railway Station. The report states:
For these reasons we are of the opinion that insufficient control was exercised by DoEn, especially during the early stages of the scheme and that its financial basis was progressively eroded by factors which should, to some extent at least, have been foreseen.


The Department's activities in Northern Ireland have been examined by the PAC, and the exposure can be only for the good. I trust that it is a shot over the bows to tell the Department that the House is taking note of what has happened.
A matter that disturbs us all in Northern Ireland is financial assistance to industrial undertakings. We want to see industries come into Northern Ireland, but we do not want to see industries that grab the grants, continue for a short time and then leave. It would be interesting to know how many businesses came in and left on that basis. A vital reference is made in page xiv, paragraph 29, which states:
Your Committee are of opinion that in this instance DOC was unduly influenced in both respects by considerations outside the immediate field of commercial judgment.
That has happened over and over again, and the possibility of making the industries viable is totally remote. However, the Government will continue to have them because of political considerations. For example, there was a shirt factory in Londonderry where the Government grant was being used to pay the wages. It was told that at a certain date the Government grant would cease. There was no possibility of that firm ever being viable.
On behalf of the people of Northern Ireland, I thank the PAC. I am glad that there has been the opportunity tonight to lay matters before the House that are of the greatest importance to the people of Northern Ireland. I trust that the PAC will continue to keep a close eye on the way in which the Departments in Northern Ireland are living up to their stewardship.

8.35 p.m.

Mr. Geoffrey Pattie: I always find it helpful to look back at previous debates when reports of the Public Accounts Committee have been before the House. In one of them I noticed the following extract—and the House may care to guess when the debate occurred:
Well might the right hon. Gentleman the Chancellor of the Exchequer be compelled to point out in his last budget speech that the total interest on the savings of the nation during the last ten years had been absorbed and swallowed up in the grave of this vast expenditure. At a critical epoch in our recent

history we were authoritatively reminded, and from a very high quarter, that representative institutions were upon their trial. Looking at the inordinate growth of our national expenditure, as sanctioned by Parliament, could it be long, he would ask, before public opinion would indignantly repeat that solemn warning? He thought not. And he must add that the aiders and abettors of the present mania for extravagance would be alone responsible should the masses of their countrymen be forced to believe that Parliamentary Government, as now administered, is nothing, after all, but the cunningest device which the selfish subtlety of the governing classes could contrive to extract the largest amount of taxation from the hard-working, overburdened, but unrepresented portions of our community.
That was said in the course of the first debate in the House, following the establishment of the PAC, in March 1861, and the Chancellor of the Exchequer referred to was none other than Mr. Gladstone who, later in the same debate, said:
If the question of a Committee to examine the Estimates and expenditure is to be debated, all I can say is, there never was a proposition which more entirely deserved solemn and separate discussion—a proposition more important and one cutting more deeply into the roots of our entire Executive—ay, and I may add into the roots of our political system—it is difficult to conceive. At any rate, it is a proposition most inappropriate to mix up with a discussion on the manner of rendering or examining public accounts. I cannot attempt to discuss these entirely different matters at the same time, but I will direct myself to the principal object of the noble Lord. He has shown on this occasion his own zeal and diligence; and the House will be extremely glad to see another Member of Parliament adding himself to that number—necessarily a very small number—who are disposed to give up their time and attention to the driest of all possible subjects, but which is also not the least important—namely, that of rendering and examining the public accounts, and facilitating the functions of the House with regard to the public expenditure.
As we know, the PAC was established in 1861, and there have been annual debates ever since. Here we are again looking at a number of Reports from the Committee. This has been my first year as a member of the Committee, but I know that all members of it have their favourite items in the Reports. Mine are the RARDEN gun, to which my right hon. Friend the Member for Taunton (Mr. du Cann) referred and which surely must be a classic for inclusion in all future textbooks examining what is meant by "critical path analysis", and the case of Friern Hospital, which, as the House will recall, involved the dumping of 250,000 cubic metres of


rubble on hospital land without the appropriate authority.
As the newest member of the Committee, perhaps I may be allowed to pay my own tribute to my right hon. Friend the Member for Taunton for his guidance and chairmanship of the Committee. However, I take this one small point of issue with him. In his excellent speech, he mentioned the possibility of a sum of, say, £1,000 million as having been identified as the sort of excess at which we might look. My own investigations have shown that the figure could be somewhat lower than that—possibly in the region of £400 million.
When we have examined certain Departments, I have detected amongst my colleagues on the Committee something of a sense of unease—the feeling, almost, that they have been there before and that they are seeing the Departments yet again. This is compounded by the fact that they may be seeing them in future years. This feeling has been heightened by the impression, taken from the words of the famous Albert monologue that no one is really to blame.
We examined some of the most extraordinarily bizarre circumstances, and it was very difficult to find who was there at the time. The responsibility seemed to be nicely diffused between various sub-departments. We rarely hear of disciplinary action being taken in these cases.
I pay tribute to the Comptroller and Auditor General and his staff. I have been very impressed when I have dealt with them. Various types of problem come before the Public Accounts Committee. One example is the case where expenditure has vastly exceeded the estimate. This is often caused by very bad project management, or bad estimating at the outset, or a combination of the two. In this respect, we could refer to the Farnborough wind tunnel, or hospital computers, both of which have been mentioned in the debate. There is also the case where action is not taken when it should have been, such as rents in BAOR. There are other examples of action being taken where it should not have been taken, such as Friern Hospital. Then we have the consequences of various policy decisions—I think the

question of jobcentres has been adequately ventilated already.
A new boy to the Public Accounts Committee might well ask how effective this Committee is. I believe that it is still highly effective. It calls on the Departments to do a tremendous amount of preparatory work in getting their cases right before coming to the Committee, and it seems to me that answering the Committee's questions is a salutory form of discipline. This is useful to permanent secretaries as a sort of management tool when they are new to large and unwieldy Departments and are grappling with matters of scale and complexity. They can point to the PAC as a form of discipline.
Then there is the fact that certain Departments are pleased when the PAC examines a particular problem and says that it is satisfied with the action taken, or with the remedial action. That causes a great deal of pleasure and satisfaction. One of the major problems with the activities of the PAC is that it is used as a kind of bogyman. One might say "If you do not wash your hands, brush your teeth and say your prayers, the PAC man will get you". There is a certain amount of evidence of this. I refer to the Defence and External Affairs Sub-Committee of the Expenditure Committee, when it reported at the end of July. On page 24 of its report it says
The Ministry noted that it was the extent and intensity, and not the principle of monitoring which was at issue. They had no wish to monitor their contractors or sub-contractors in more detail than was necessary, having regard to the sums of public money involved, the competence and management systems of the firms, and the complexity of the tasks. They recalled that it was not so long ago that the Public Accounts Committee and the public generally were highly critical of the apparent lack of control of expenditure on large development contracts.
In that case and in that industry people were worried about the Ferranti affair. After that, everyone chased about and set up all sorts of control mechanisms, involving large numbers of people. The same Committee received evidence from Hawker Siddeley Dynamics, and Captain Lewin refers to the number of visits that his factories received from the Ministry of Defence Procurement Executive. On page 37 he refers to 1975. He says:
During September and October of last year, and these are typical months, we had


from the MOD PE 385 day visits at Hatfield alone; at Lostock which is our production factory, 290 and at Stevenage, which concentrates on space, we had 85, making a total of 760 during two months, and this is leaving out the financial side. What I have just said is the equivalent of 20 persons per working day. If I add to that the financial oversight which amounts to 18½ persons a day, we get a total through the company—and it is quite a small company as companies go—of 38½ visitors of one sort or another every working day. Each of those visitors, if he is coming for a useful purpose, has to be nursed by the preparation of documents, by being looked after while he is with us. Sometimes it takes one of us to look after one of them. Leaving aside any expenditure which falls on the MOD, which must be considerable because they have to travel, the expenditure on us is very considerable. Much of it falls on the taxpayer, but some of it does not. When it does not it inevitably puts the price of the merchandise we are trying to sell abroad up. It is an overhead which has to be put on everything we make. It is for that reason that we feel we are in danger of pricing ourselves out of the business as a nation.
That point is extremely significant. It is something that the people who consider the future of the PAC should bear in mind, because in order to be cost-effective we must obviously have highly-trained, highly-skilled and highly-effective people. There is a tendency at the moment, however, for Government Departments to say "The PAC would not like that", and then to extend the quantity and depth of its monitoring beyond the point at which it is in any way cost-effective.
In his excellent speech my right hon. Friend the Member for Taunton mentioned the United States General Accounting Office. In considering the future of the PAC, it could well repay this House to consider the scope and activities of the General Accounting Office bearing in mind, of course, that there would have to be a considerable recruitment of staff if we were to extend the activities of the PAC that far.
However, there is an opportunity here. The question about the National Enterprise Board is unresolved, and there is the possibility, should the Aircraft and Shipbuilding Industries Bill reach the statute book that there will be another two nationalised corporations. Could not these three bodies be audited by the Comtroller and Auditor General? I should be happier if I knew that he was carrying out the audit. That might give Parliament slightly more control in respect of the point that my hon. Friend the Member

for Surrey, North-West (Mr. Grylls) was making earlier.
Let me now quote an extract from Greenwell's "Monetary Bulletin", which came out on 18th February this year and dealt with the United States system. It said:
The new U.S. system has received little publicity so far in the U.K. Under the old U.S. system Congress debated and passed individual expenditure bills without reference to the overall budget deficit. Under the new U.S. system whenever additional Federal expenditure or a tax reduction is passed, either offsetting action has to be taken elsewhere to neutralise the effect on the previously agreed budget deficit or the increased budget deficit must be debated and passed. The U.K. should adopt a somewhat similar system. Not only should the cost of policy changes be announced in Parliament, but also the consequent change in the budget deficit should be debated and passed by the House of Commons.
If we moved along those lines we should be extending and making more effective the work of this excellent Committee.

8.49 p.m.

Mr. Robert Taylor: There is obviously full agreement that the Public Accounts Committee has covered a great deal of ground in the year under review. I wish to draw attention to three particular issues which we discussed at great length. I have selected them because I believe that there is an opportunity in the case of each for the Treasury to take action which would make an effective, albeit small contribution to reducing Government expenditure.
The hon. Member for Stockport, North (Mr. Bennett) suggested that the Public Accounts Committee always looked at events after they had taken place and that this was not constructive. But some issues examined by the Committee involve expenditure of a recurring nature. It is that point to which I wish to draw the Minister's attention in the hope that he will take action.
Of the three issues that I wish to raise, only one has so far been discussed. My right hon. Friend the Member for Taunton (Mr. du Cann) and my hon. Friend the Member for St. Ives (Mr. Nott) referred to the Manpower Services Commission. I should like to confine my remarks to the Professional and Executive Recruitment Service of that organisation.
It is a fact that the Department of Employment has had an obligation since 1940 to provide a service for professional people and other executives who are out of work and seeking employment. As a result of the Employment and Training Act 1973, that service was revamped. That gave us an opportunity to see accounts broken down to such a degree that we could find out the cost of that small service.
The Comptroller and Auditor General confirmed that, when the service started again in 1973, it was on the basis that the year 1974–75 would produce a surplus of £60,000 and that the year 1975–76 would produce a surplus of £345,000. But the deficit in each year has been £1 million. In addition to that, the Government are making a handsome social subvention payment in excess of another £1 million. Thus, that small service is consuming nearly £2½ million a year. The point I wish to emphasise is that in doing so it is not in fact creating one extra job. The jobs involved would be filled anyway through the private employment agencies. I can see no objection to closing down that part of the Manpower Services Commission's activities straight away. It would make an effective saving of £2½ million per annum.
The second issue to which I draw attention is the Property Services Agency. I have on two previous occasions spoken in the House about that Agency. I make no apology for returning to it for a third time. The Property Services Agency was set up as a result of a Written Answer on a Friday afternoon without any debate in the House. In my view, it is a monolithic organisation which should be drastically pruned.
In the Sixth Report of the PAC, we see that the Property Services Agency was questioned about divers subjects such as the construction of a low-speed wind tunnel, the use of the Government car service, occupational works in new leased office buildings and the adaptation of accommodation for use as Crown courts in London. In addition, the Agency was involved in the Committee's questioning of the Ministry of Defence regarding delays in revising rents for accommodation in Germany. I do not believe that any chief executive can have control over

such a diverse organisation. As I have said, there is scope for great economy in that Agency.
I should like to refer particularly to the item about occupational works in new leased office buildings. The PAC examined four new office buildings in London on which £7·9 million was being spent on fittings. The total floor area being acquired was 770,000 sq. ft. Perhaps I should declare an interest, as I have done before in debates on the Property Services Agency. I am in the building supplies industry, but that is noted in the Register. Despite the acquisition of 770,000 sq. ft. of office accommodation in London, very little accommodation—in fact, no accommodation of any significance—has been returned to the private sector. It is an incredible state of affairs about which I have repeatedly questioned the Minister. No office buildings are being vacated as a result of this new leasing. It is not necessary to continue to acquire buildings—not only the four in London which total 770,000 sq. ft., but other buildings throughout the country.
The figures given to the Public Accounts Committee by way of a note from the chief executive show that in 1975–76 it is expected that the Property Services Agency will have given up 170,000 sq. ft. and that for the current year the figure will be 280,000 sq. ft. Those are insignificant figures. They represent less than one of the four buildings which I mentioned earlier. I am convinced that there is scope for great economy in the Property Services Agency.
The continued leasing of these new buildings and the building of others illustrates what is wrong with this country. There are too many people being housed by the Civil Service. The wealth producers are paying for that extravagance through excessive taxation, which is sapping the will to work. I do not blame the Agency, because it is an agent of the Government. It is carrying out instructions given it by Government Departments which seek new office accommodation. There must be a time to halt the process. It would be feasible for the Treasury to say that for the next three years there will be a complete embargo on office accommodation for the Civil Service beyond the commitments


into which the Agency has already entered.
My next issue is small but important —the Liverpool Teaching Hospital, which was covered under the inquiries we made into the National Health Service. The original tender figure for that hospital was just under £14 million. Today that figure is over £49 million, and we have been warned that there is still more to come. How can the cost of constructing a hospital increase from an original tender figure of £14 million to £49 million and shortly pass £50 million? The figures are serious. They are not only startling but totally and utterly scandalous. It is not good enough to say that they are the result of a contractor going into liquidation. That might have been the cause of some of the increase, but not of all of it. The matter is sufficiently serious to warrant an inquiry. We have tried to get to the bottom of it in the Public Accounts Committee and we plan to return to the subject in this Session. Some people must give us answers about how that money was spent.
Many boroughs, not least Croydon, urgently require a new hospital. What hope is there for Croydon if one contract has risen from £14 million to £49 million? We must know who is responsible for that extravagance.
It is a privilege to serve on the Public Accounts Committee, and I thank my right hon. Friend the Member for Taunton for the way in which he has presided over our meetings during the year.

9.0 p.m.

Mr. Peter Hordern: I join with my hon. Friend the Member for Croydon, North-West (Mr. Taylor) in his tribute to the work of our chairman, my right hon. Friend the Member for Taunton (Mr. du Cann). Many kind things have been said about him during our debate. I thought that his speech demonstrated the valuable rôle which he plays. My right hon. Friend is an extremely good investigator, whose questions are always cogent. As he said in his speech, our problems in examining the public sector become more difficult as that sector grows.
One of the points made so well in the debate was that we as a Public Accounts Committee must expand our

rôle in line with the extra power which the Government take upon themselves. Here I speak of all Governments. The extension of Government influence and expenditure must be matched, if not in quantitative terms then at least in the rôle we play as the PAC. One of the things we have to watch rather carefully is the way in which the Government try from time to time to obfuscate their operations. They did it some years ago in establishing the Property Services Agency and the regional area authorities for the health service. They have done so notably in this past year in the establishment of the National Enterprise Board.
I wish to mention the NEB first. My hon. Friend the Member for Surrey, North-West (Mr. Grylls) made a good point about the establishment of the NEB. We were in some doubt about whether we would be able to apply proper questioning to the NEB. I hope that the Financial Secretary can give me a specific answer on this point. On page 6 the Treasury Minute, dealing with paragraphs 59 to 64 of our report, says that the Treasury and the Department of Industry:
believe that the provisions of the Industry Act 1975 recognise the need for proper Parliamentary scrutiny and control of public funds made available to the National Enterprise Board, and they see no reason to expect that in practice the Committee will encounter any difficulties in the exercise of their responsibilities for examining the funds so provided to major industrial undertakings.
I take that to mean—I would be grateful if the Financial Secretary would confirm it—that we shall have arrangements no different from those that we now have when we examine the Department of Industry on similar industrial undertakings.
I do not wish to deal with specific examples, because so many have been mentioned. Instead, I shall refer to some hardy annuals. A continuing feature is the work of the NEB and, in particular, its rôle in industrial intervention. I am sorry that the hon. Member for Coventry, South-West (Mrs. Wise) is not in her place, because I wish to mention Meriden. If the existence of these co-operatives had any point at all it was to provide not only some economic viability but some regional assistance, and particularly to help in areas of unemployment. That, at least, is what we have been told. It so


happens that the firm of Kearney and Trecker Marwin, which has been mentioned, operates not in Sunderland or some other hard-hit part of the country but in Brighton, near my constituency—that is, in the area which has the lowest level of unemployment in the country.
The facts are in the report, and it is clear that this venture was a disaster, and probably still is. There was no reason for it at all. As for Meriden, the facts are now well known. The sum of £1·6 million was paid for land and buildings officially valued at £1·15 million, while £1·2 million was paid for plant and machinery valued at £600,000. The hon. Member for Coventry, South-West suggested that the difficulties that the Meriden Co-operative experienced concerned the existence, earlier, of Norton-Villiers Triumph. The reverse is the case. Had the report of the industrial advisers been accepted, suggesting that Meriden should be closed down, it is possible that NVT would still be in existence. It is certain that the existence of the Meriden co-operative scuppered the chances for NVT. The hon. Lady said that she would tell us the present position, but she failed to do so. We do not have to guess very much that the Meriden Co-operative is running at a severe loss.
In many respects, the case of the Scottish Daily News is the most disgraceful episode of all. It was liquidated six months after it began publication. But that is not all. The workers were not only involved in the management sense but were encouraged to subscribe their own money to the venture by no less a person than the then Secretary of State for Industry, now the Secretary of State for Energy. I want to quote what he said on 29th March 1975, in a statement issued by the Department of Industry.
Mr. Wedgwood Benn…said the birth of the Scottish Daily News 'will be an historic event'. He added: 'It will be the first national newspaper to be run by its workers free from political pressures and commercial interests, and constitutes a general victory for the people it seeks to serve.
'This paper has been created by a courageous and determined group of workers who have suffered great hardships to make it possible. They would not accept defeat and I hope the newspaper will be read throughout the United Kingdom.
It was not the workers who were at fault. They were encouraged and pressed by the

right hon. Gentleman to commit their work and their savings to the venture.
Dare I suggest that if this had happened in any other business, that business would have been liable to prosecution under the terms of the Companies Act 1947? I think that that would have been the case. If anyone had made such a statement in advertising units for sale in investment or unit trusts, or any form of company, he would have had to make a disclaimer that it was possible for shares to go down as well as up. No such disclaimer was made in this case.
It was most reprehensible if not shameful behaviour by the right hon. Gentleman. One would have thought that the least he could have done at the time, when he knew that the members of the co-operative were going to advance their own funds, would be to subscribe his own money to the venture. I am not talking of funds in his Department. Having given these people some encouragement, he might have put his own personal funds in as a matter of honour.
I want to take up a matter of more major concern in which we have been interested for some time past and will no doubt be interested in in the future—the question of shipbuilding. In Appendix I, on page 541 of the report, which describes the rôle of the Department of Industry in rescue operations, there is a reference to what happens when a receivership is brought into play. It says:
A receivership or a liquidation does not necessarily involve the complete cessation of a company's activities, since the responsibilities of the receiver or liquidator towards creditors will often be best fulfilled by maintaining the business as a going concern in order to secure the highest price…This, rather than the propping up of failed enterprises, is and should remain the principal contribution that the Industry Act—although not primarily an instrument for dealing with redundancies as distinct from promoting development and employment—can make towards dealing with redundancies; and it is likely to have the advantage of involving new management and additional private sector resources.
In my view that is the action which should have been taken, in the case of the co-operatives, instead of trying to rescue them. The word "receivership" is a pejorative term. It is not a fair description of the activities of the receiver, who, in many cases, manages to achieve a successful rescue act.
I quote that part of the report because it is of continuing importance for the shipbuilding industry. During the past two or three years we have had to examine Government assistance to various shipyards. We were told that in 1974–5 the total amount of assistance given to two shipyards, namely, Govan and Cammell Laird, would amount to £60 million. So far, Govan has consumed £60 million and Cammell Laird £40 million. Upper Clyde has so far consumed £80 million. I forget for the moment the figure for Harland and Wolff, but at any rate it is very substantial.
We are not the only country to subsidise our shipbuilding industry. Many other countries do the same. Norway is giving £18 million to subsidise its shipbuilding industry. In Norway, 50,000 jobs are involved. It is expected that only half the shipyards in Norway will have any capacity until the end of 1977. In the whole of the world, shipbuilding over-capacity is about 60 per cent. United Kingdom yards produce 1 million tons of shipbuilding a year, out of a world market of 13 million tons. We can expect a drop in shipbuilding orders of about 60 per cent. and a loss of employment of possibly 20,000 out of the 41,000 jobs which now exist in shipbuilding.
Today we heard of the resignation of Mr. Day. I do not know what will be the position after his resignation, but it is certain that the reorganisation of the shipbuilding industry will present substantial difficulties. What is the long-term plan for the industry? That is the question which needs to be most closely considered. Otherwise, every year we can expect the Department of Industry to ask for yet more money for various yards. Literally, it is an endless process.
I have made some calculations, which show that so far at Govan and Cammell Laird each man has received the equivalent of £8,000. In Upper Clyde the figure is £7,000 a head. In Harland and Wolff it is about £10,000 a head. How long can this continue? A searching review of the capacity of world shipbuilding and of our future capacity is required. Otherwise, how much longer have we to continue forking out these sums of money?
The Treasury reply to this point was an unusually poor one. It said that
In the longer term, if the nationalisation proposals now before Parliament are enacted,

it will be the duty of British Shipbuilders to formulate a strategy in the form of the corporate plan which it will be required to produce annually. However, if any further direct financial support were being contemplated either for Govan or for Cammell Laird, the Departments would compare the cost of that support with the resource costs of closure, and with social costs so far as quantifiable.
The Treasury reply does not take into account the continuing cost of support compared with the once-for-all cost of closure and the once-for-all social costs if such action were taken.
I do not know what the Government will do about a shipbuilding programme, but it is quite indefensible to keep thousands and thousands of men employed on the basis that they will be working in industries for which there is no reasonable prospect for recovery. It is a condemnation, almost a conviction, to work in an industry which cannot give any satisfaction. One problem with Upper Clyde is that no improvement in productivity has been made. That is not surprising. The members of any group of workers in a dying industry know that if they work hard they will work themselves out of a job. Why should they improve productivity?
It is necessary for the Committee to explore the long-term future of shipbuilding. I have just received an answer which tells me that the proportion of world shipbuilding completed in the United Kingdom in 1965 was 10·9 per cent.; in 1970 it was 6·3 per cent., and in 1975 it was 3·4 per cent. We cannot go on supporting an industry like this for year after year, with disproportionate cost. It would be a much better prospect for the workers in the industry and for the country if we took a view of the long-term future. Certainly, we must have some form of shipbuilding industry, but we cannot sustain it at the present rate. It is time that fact was realised.
I wish to refer briefly to one other aspect of public expenditure—the increase in staff numbers in the Civil Service, particularly in the Inland Revenue. On 1st April 1975 the number of staff in the Inland Revenue was 74,000. On 1st April this year it was 81,000. We are told that by 1st April next year it will be 90,000. That is an accelerating increase. I would guess that we now have the same number of staff in the Inland Revenue as has the United States, and


possibly more, so fast are the numbers growing. The Inland Revenue salary bill in the last two years has increased from £139 million to £242 million. That represents a substantial slice to income tax.
The defence put to us by the Department is that this matter is subject to cash limits. I know that my right hon. and hon. Friends give credit to the Government for introducing that system, but we should not blind ourselves to its operation. It is perfectly simple at the beginning of the year to set a cash limit which is way above the cash limit at the end of the previous year. At the end of that year it is easy to set another cash limit which is far in advance of the previous limit. It is not difficult to keep within the cash limit if the limit is very generous. We must examine this much more carefully.

Mr. Andrew F. Bennett: Will the hon. Gentleman quote one example of a generous cash limit given over the past two years?

Mr. Hordern: Yes, the Insland Revenue, for one. Its cash limit is extraordinarily generous.
I come back to what I believe to be the most important aspect in the work of the Committee. Our rôle must be an expanding rôle. It is very different from our traditional rôle, accorded to us ever since the days of Mr. Gladstone, of looking at expenditure after the event, examining what is happening and seeing what should be done to put it right.
In addition to the cash limit system, the Government have evolved a new system of presenting their accounts. It is a very good one. They give Departments a profile of expenditure, and monthly reports are made showing how expenditure compares with the profile. Those results appear 10 days after the end of the month.
The Public Accounts Committee is the most senior Committee of the House. This is a totally new development produced by the Government. We are entitled to see what are the cash limits and how they are functioning. We also have a right and duty to see how the Government are getting on in controlling their expenditure. These profiles form the

basis of the Government's forecast for the following year. The Government publish the forecast, so that it is generally available to the public. There cannot, therefore, be any sensible objection to publishing the monthly accounts and giving information about the monthly cash limits. We need that information if we are to do our job properly in controlling the Executive and helping to control public expenditure.
Our Committee is very slow in increasing its own expenditure. I wish that were true of every Select Committee. I notice, for example, that the Select Committee on Nationalised Industries found it necessary to go to about five countries to inquire of their respective central banks what they think of our central bank. The result was that they thought that our central bank did a good job.
I think we should make an expedition to see the United States Public Accounts Committee carrying out its work. There is no real alternative to a first-hand examination of the way in which that Committee works. I know that my right hon. Friend the Member for Taunton has visited that Committee, but other hon. Members would also be interested.
The United States Committee's approach to controlling public expenditure is very different from that which we have previously adopted. Not only are there other experts, as well as accountants, in the Auditor General's office, there is also a larger service. That service is entitled to examine Government expenditure in all Departments, to say what will be the trends of expenditure, and to make positive reports. That is the kind of service that our Public Accounts Committee ought to have.
We have, in considering our reports, dwelt a great deal on past events. It is time that we brought ourselves up to date, if only to monitor correctly the present and future activities of the Government.

9.21 p.m.

Mr. David Crouch: I wish to refer to the speech of my hon. and learned Friend the Member for Thanet, West (Mr. Rees-Davies). He referred to Canterbury many times in his criticism of the administration and the administrators in the National Health Service and of parts of the administration


of the NHS at county level, including the regional health authority, of which I am a member.
My hon. and learned Friend made a good constituency speech. He worked himself up into a great lather with his criticism and his attempts to find anyone responsible for anything in the management of the NHS. But he also made rather a meal of it. My hon. and learned Friend is not now present. I am sorry for that, because I hoped he would be here. Hon. Members are generally only too ready to criticise the administration of the NHS.
Something has already been said by Sir Patrick Nairne and by the Secretary of State to the effect that, since reorganisation, it is absolutely essential that all those who work in the NHS—not only the administrators, but junior doctors, nurses or whatever—should have an opportunity to settle down and make the system work. That is not as difficult and complex as my hon. and learned Friend made out.
My hon. and learned Friend referred to the Chairman of the South-East Thames Regional Health Authority, Sir John Donne, who within that region and in a wider sphere is one of the outstanding men in the National Health Service today. I think that if my hon. and learned Friend went to the top in making his inquiries he would not find so much wrong in the administration of the NHS as he suggested.
I wish to refer to another matter that has been revealed in the six reports of the Public Accounts Committee, on which I have the honour to serve, but first I wish to say how much I appreciated the introductory speech the debate by my right hon. Friend the Member for Taunton (Mr. du Cann), who is Chairman of the PAC. He does a great service to the House and to the country by the manner in which he chairs this senior Committee. He does not rest on his laurels or those of the 500 staff working behind the Committee. He really adds something to the Committee through his application, and he does a great deal of work. For all those who serve on the Committee, he has created a serious atmosphere which is understood and appreciated by the House.
A consultative document on the English dimension of devolution was published today. It contains a comment on the difficulties that would arise if further devolution took place in England. It would impinge on the ability of Ministers to account to Parliament for the services they administer. Devolution or the transfer of powers from the centre to English regional bodies would make it difficult, according to the document, for Ministers to know what was going on and to keep effective control of Departments. But this problem is already with us without devolution in England. Government and departmental control, Government intervention and departmental activity are already massive, seriously over-active and burdensome.
The reports reveal all too clearly that Departments often do not know what is going on. This is a disturbing situation. The complexity of devolved responsibilities is now suggested by accounting officers to the PAC as a plea of mitigation.
In the National Health Service there are the Secretary of State and the Department at the centre, with 14 regions throughout the area responsible for the administration of more than £4,000 million. It is difficult for the accounting officer and the Secretary of State at the centre to know in detail what is happening in the administration of those moneys. One example is the case already referred to by my hon. Friend the Member for Croydon, North-West (Mr. Taylor) in which the costs of a new Liverpool hospital escalated from £14 million to £49 million and the building is still not complete. We have had many such examples from the DHSS and from other Departments. In many cases the responsible accounting officer tells the Committee, in effect, that it is difficult for him to keep control when there is so much devolution of responsibility.
The PAC recognises these difficulties, but Parliament cannot afford to acquiesce in this situation. The PAC investigates on behalf of Parliament and the public, and we have to know what has happened in the administration of Government expenditure.
Comments have been made about a possible extension of the rôle of the PAC, but whether extended or not, it has an important rôle in examining what is


already happening and to require the persons responsible to account for their decisions. We require accounting officers to account for their stewardship and we must hold them responsible for errors, mistakes, delays, losses, extravagance, carelessness or even negligence.
It is not always easy for the Committee to carry out this task. The officers who appear before us are senior men and women holding high positions. It is not that which intimidates us as much as the fact that we understand their difficulties in administering such large amounts of money in the complex structure of management which has grown up in the Civil Service. These people are often impressive, and on many occasions we find them likeable. It seems hard to criticise them for the structure of management which they head and which is frequently inadequate for achieving good control.
Nevertheless we have a duty to be critical, and there is no absence of criticism in the reports. But the public do not really see the reports. Even Parliament does not take the trouble to see them, although we have an opportunity to do so in this debate. Certainly not all Members of Parliament see the people who come before the Committee. That applies only to the select few of us who serve on the Committee. We have a responsibility on behalf of Parliament as a whole to criticise. It is a public safeguard against the mistakes discovered not being repeated, that is all. That is the function of the Committee.
The question I wish to ask is whether the Committee is doing any good. Is the Public Accounts Committee—as it likes to say and to feel that it is when it comes before the House with some pomp and display—always there as a safeguard? Is the Committee effective? The reports disclose considerable inefficiencies and, in some cases, gross extravagance and lack of control of Government expenditure down the line from Government Departments to regions and areas.
The reports contain strong censure of the failure of officials and Departments to employ proper methods of control, but what happens as a result of this strong censure and the strong words used in the House? I have a fear that after the interview sessions with the Committee, which

sometimes are gruelling to those who come before us, and after publication of the reports, there could well be a general feeling of relaxation in the Departments. Do the officers in a Department heave a sigh of relief, recognising that Parliament has only been doing its job but feeling that the job of the Department is too difficult these days for accounting officers to be able to spot mistakes before they are made?
Let us look at the example of the Crown Agents affair, to which the hon. Member for Coventry, South-West (Mrs. Wise) said that we had not given enough attention. What has happened in the case of the Crown Agents is incredible. In 1967 the Crown Agents started borrowing and lending with a view to making profits, though I would not criticise them on that point. The Ministry for Overseas Development, which is responsible for the Crown Agents, was not aware that the Crown Agents were doing this and knew nothing of this new development. The Treasury was not aware that the Ministry had relaxed its control over the Crown Agents.
Two years later, in 1969, the Ministry looked into the Crown Agents' activities very carefully and decided that they were being conducted in a sensible way. In February 1970 the Treasury learned from the Ministry that the Government carried ultimate responsibility for any losses that the Crown Agents might incur. The Treasury, too, got in on the act, but still no action had been taken against what the Crown Agents were doing.
The Ministry set up a committee of inquiry under the chairmanship of Sir Matthew Stevenson. In March 1972 that committee reported that the management of the Crown Agents was competent. Seventeen months later the Ministry acted on one of the points of that committee, after nearly one and a half years, and notified the Crown Agents of a slight change in their status and defined their new responsibilities. All this time the Crown Agents had been advancing substantial sums to secondary banks and property companies without consulting the Ministry. In 1975 the Crown Agents revealed that they had losses of £25 million, together with a capital deficit of £44 million, and they had to be bailed out with a grant of £85 million from the Government.
This is merely one example of what is happening under the eyes of a controlling Ministry and the Treasury. As the Government extend their activities more and more into industry and vast sums of public money are distributed. Parliament must ask whether the controls are effective. We must ask whether criticisms by the PAC are effective. This is not a matter of policy but is a matter of parliamentary procedure.
I am concerned to see that where capital is provided to the National Enterprise Board in general, through the National Loan Fund or through public dividend capital, the information required by the Comptroller and Auditor General about such loans will be restricted. I hope that the Financial Secretary will bear this point in mind when he replies to the debate.
The present situation is not good enough. Parliament has a duty to say so and to stop the Government in their tracks if we think that that is a correct thing to do. Perhaps the PAC always shuts the stable door after the horse has bolted, but Parliament has the right to say who has left the door open and, if necessary, to see that the stable boy is sacked.

9.36 p.m.

The Financial Secretary to the Treasury (Mr. Robert Sheldon): We have had a debate on the work of the Public Accounts Committee which has surpassed similar debates in recent years. To begin with, the debate has run its full course, and it is some time since that has happened. We have had the benefit of a wealth of experience on the part of those who have served on the Committee, and all who take an interest in these matters will recognise that to-day's contributions have been well above the standard that has been set for so long. That is an indication of the respect held in the House for the right hon. Member for Taunton (Mr. du Cann) and the way in which his Committee has acted. Nobody can deny that the watchdog has barked and is keeping awake those responsible for the expenditure of public money.
When I examine the work of the PAC in investgating 43 main subjects detailed by the right hon. Gentleman and look

back on my own experience as a member of PAC for a period of six years—the happiest years I ever served on a Select Committee—I can appreciate the way in which the Committee has developed and needs to develop.
There has been a certain questioning attitude about the future of the Committee and the way in which it can bring its expertise to bear. My hon. Friend the Member for Norwich, South (Mr. Garrett) and other hon. Members have gone into the background and have advanced various suggestions. I shall return to that aspect of the matter later in my remarks.
The staffing of the Public Accounts Committee has been excellent. It is another matter whether its expertise needs to be changed in the way suggested by my hon. Friend the Member for Norwich, Souht. The constant improvement in standards and the constructive search and care taken in examining these matters are all extremely important considerations.
I administered a mild rebuke to the hon. Member for St. Ives (Mr. Nott) a little earlier because I believe that these discussions must go well beyond the ordinary party fights that take place in this House, and it is right that that should happen.
My hon. Friend the Member for Coventry, South-West (Mrs. Wise) made a number of valid points and mentioned the way in which these considerations need to be balanced. The work of the PAC involves close scrutiny, and it needs the strength that come from the united effort in all parts of the House in seeking to ensure that the Executive is brought to account in the traditional way. That way needs to be brought up to date and needs to take into account various changing conditions.
That was the burden of the speech of my hon. Friend the Member for Norwich, South, who brings to bear on these matters an immense expertise which is welcomed and respected by the House. He said that the Public Accounts Committee and the Exchequer and Audit Department should test not only that the money has gone for the purposes intended, as well as the efficiency which is now regarded as normal in these examinations, but also whether other methods of achieving the goals are possible.
The hon. Member for St. Ives made an important point about the levels of accountability needing to be set lower down. I agree entirely. The difficulty is that when a permanent secretary appears before the Committee—one sympathises with him because of the difficulty of copping with complex structures in his Department—it is much more likely than not that he was not responsible when the error was made. So the attribution of responsibility is very difficult.
This valuable accountability can be achieved only if we can pinpoint who made the decisions, whether good or bad, and get at the decision-makers rather than some person who speaks for the entire Department but cannot claim complete knowledge even if he was there at the time.
My hon. Friend the Member for Stockport, North (Mr. Bennett) asked for certain reforms in the PAC. He asked the rhetorical question, when did a Minister ever resign? That shows the emptiness of some claims about controlling expenditure. We know, however, that the difficulty is the same as getting accountability from permanent secretaries: often the same Ministers are not responsible when the PAC examines these matters.
It might be argued that the Minister should be brought to account so that success or failure can be attributed, but even that is not a possibility, for many complex reasons—primarily because he can always claim that since he left the Department circumstances have changed and that he would have pursued a different policy. Part of that answer may be true, but in those circumstances accountability and attribution become impossible. We must live in an imperfect world and within those limits the PAC, perhaps with the improved staffing and expertise which has been suggested, will continue to live.
My hon. Friend the Member for Norwich, South mentioned the relationship between the PAC and the Expenditure Committee. There has been one development since we discussed these matters last year. The Expenditure Committee, headed by my hon. Friend the Member for Bishop Auckland (Mr. Boyden), will, I understand, be examining those expenditures which are the responsibility of

each of the Sub-Committees. That is a recommendation that I have been trying to make for a long time and which I sought to put into effect when I was Chairman of the General Sub-Committee of the Expenditure Committee.
The decision then reached did not come into effect because of the General Election of 1974, but I am glad that it has been resurrected and I look forward to seeing the impact of the Sub-Committees upon those expenditure programmes in which they have at least some interest, even if they are not necessarily responsible for them. Obviously the direction it may take from then on can vary, but it is an important step forward. I look forward to seeing the results of it and I welcome it.
My hon. Friend the Member for Stockport, North dealt with the experimental computer programmes. These programmes were set up in the hospital authorities and elsewhere, and we must remember the background against which they were initiated. They are really products of the enthusiasm for computerisation which swept the country in the late 1960s. The Public Accounts Committee is quite right in its criticism and in its concern about the evaluations which need to be made of major projects of this kind.
Following the criticism which has been made, the Department of Health and Social Security will be gathering evaluations. We hope that this work will be completed early next year, and I expect that a report will be available from which the National Health Service will be able to obtain some very useful insight into the way in which this kind of computer change takes effect.

Mr. Costain: Will the Minister look into the computer situation? It is ridiculous that we have a whole series of computers which cannot even speak to each other because they are all in different languages. Is not that too absurd?

Mr. Sheldon: I take note of the hon. Gentleman's comment. The fruit of this evaluation will be a report which will bring some useful lessons to bear on the way in which these programmes ought to be introduced.
The hon. Member for Croydon, North-West (Mr. Taylor) spoke about the need for accountability lower down in the National Health Service, and this echoed the point made by the hon. Member for St. Ives.
It might be helpful if I commented at this stage on the point made by the hon. and learned Member for Thanet, West (Mr. Rees-Davies), who spoke about the failure concerning the reorganisation of the Health Service. He referred to some of the evidence given by the Permanent Secretary to the Department of Health and Social Security, who promised notes on several subjects which he had analysed and did not present them. These notes were not printed in the report of the Public Accounts Committee. As I understand it, that means that the Public Accounts Committee itself took the decision not to print them. I understand that the notes were indeed produced. Probably the reason why they were not printed is that they were subsequently side-lined.
There has been a fair amount of comment on the Manpower Services Commission—

Mr. Rees-Davies: Does that mean that the notes are available? Questions of the very greatest importance were raised concerning the structure of the Health Service, numbers, bed occupancy and so on. Would this information be available for the House?

Mr. Sheldon: It is not for me to speak for the Public Accounts Committee, but normally in cases of this kind some material might be side-lined as being of a confidential nature. The Public Accounts Committee does not wish to have matters published for very good reasons. I am not aware of the precise reasons for not printing them in this case.
The jobcentres have been criticised as being a very expensive method of obtaining increases in employment, and a number of comments have been made on them. I take note of the criticisms and comments which have bene made. There has been some examination of their performance, and it shows that these new jobcentres, wherever they may be put, have resulted in a 30 to 40 per cent. increase in the number of placings for employment by comparison with the old

employment offices of which the jobcentres are the modernised successors.
On the one hand there are the modernised offices, and on the other there are the jobcentres. The jobcentres have produced an increase in the number of placings amounting to 30 per cent. to 40 per cent. Clearly the figures need to be analysed with some care. It is not enough merely to quote figures of that sort. There is a need to look much more closely at areas of comparability. However, I offer the figures to the House in the hope that they might be of some use. I know that in the meantime the Manpower Services Commission will make a number of surveys of the work of the jobcentres. The information will be available. Perhaps that covers some of the points made by the hon. Member for Norfolk, South (Mr. MacGregor).
As for the Professional and Executive Register, it is the aim of the Manpower Services Commission that these operations should be financially self-supporting in two to three years. That is the Commission's expectation.
The hon. Member for St. Ives spoke about value added tax and the large number of staff involved. It is true that the staff has increased, as he indicated, from about 8,000 to 11,000. We must remember that it was two years ago that the Public Accounts Committee reported that the value added tax not collected amounted to about £30 million or £40 million. At that time there was a certain amount of criticism of the failure to collect that substantial sum. Following that report and criticism, the staffing increased. I am not saying exactly what the cause and effect was, but I argued last year that we should be rather careful about criticising a Revenue Department for failing to collect the last few pounds to which it was entitled. That point was admirably expanded today by the right hon. Member for Taunton.
The increase in staff for the Inland Revenue is more startling. The hon. Member for St. Ives spoke about the need to get rid of allowances and to simplify the tax system. The right hon. Member for Taunton asked for simplification as well as for international staffing comparisons. I am generally much taken by the idea of seeking to make international staffing comparisons, on the


basis that we are not quite as different in many areas as we once thought we were. However, in Inland Revenue affairs the differences are marked, as they are in the way in which tax is collected. That being so, there are clearly limitations on how far we can go in international comparisons in this field. Nevertheless, we are seeing what advantages might be gained by moving in certain directions.
I agree with the hon. Member for St. Ives that simplification is the easiest way of proceeding. He knows as well as the rest of the House that we do not get simplification because we are a fair-minded House of Commons. As soon as we introduce a new tax or consider an old one, someone will point out in Committee that one of his constituents is in unusual circumstances producing complications and is being hurt much more than others who are in more straightforward circumstances. Soft-hearted as we are, amendments are made and there is greater complexity.
The hon. Members for St. Ives and Norfolk, South served in Committee on last year's Finance Bill. They will know that the views they expressed today will not be the views they express in Committee on the Finance Bill next year or those they expressed when considering last year's Finance Bill. They know that last year their actions were designed to produce the sort of fairness that, in its turn, produces further complexities.
Anyone who has taken part in those proceedings knows the dichotomy between our good intentions and our perhaps good practices which tends to result in further complexities. Therefore, although hon. Members express that view now, I suspect that by the time we come to next year's Finance Bill we shall have an even more complex set of financial regulations than those which exist at present.
Perhaps I might deal with some of the aspects arising from Government assistance to industry. Here we had the problems of dealing with the new form of co-operatives outlined by my hon. Friend the Member for Coventry, South-West and where we had no set pattern of principles such as that which we were able to devise subsequently. The

problems that we had there will now be made very much easier because of the criteria which have been established. Those criteria will apply to any future co-operatives.
We may find ourselves achieving some sort of synthesis even between the views of the right hon. Member for Taunton and those of my hon. Friend the Member for Coventry, South-West in that they lay down circumstances in which the decision to lend money to such firms ought to be made available. Now they are clearly known, and I think that criteria which are clearly known are the easiest to defend, rather than lending money without being fully accountable because we are not aware of the precise circumstances in which the money should be refunded in due course.

Mrs. Wise: Am I to take it that the Government are still wholeheartedly in favour of the principle of workers' co-operatives and will do all they can to encourage them?

Mr. Sheldon: Certainly. We have laid down these criteria and we look forward to further possibilities emerging where this principle may be usefully extended in the way I have indicated.
There were comments about the National Enterprise Board by a number of hon. Members, including the hon. Member for Horsham and Crawley (Mr. Hordern) and the hon. Member for Surrey, North-West (Mr. Grylls). The NEB is slightly different from some of the nationalised industries. For example, we start off with outside auditors. Then there are the problems of commercial confidentiality which apply to it in much greater degree than in most of the nationalised industries and other public bodies. But monitoring arrangements exist. The NEB will be making available to the Department of Industry information which is also to be available to the Public Accounts Committee, and the intention is that the PAC will get all the information necessary to scrutinise all funds advanced by the NEB to large industrial companies. The Comptroller and Auditor General will have access to transactions and communications between the Department of Industry and the NEB.

Mr. Hordern: Why cannot we see the NEB itself, since the information which


is confidential can be kept confidential by the Committee by the process of sidelining what its representatives tell us?

Mr. Sheldon: As the hon. Gentleman knows, the Committee will have power to send for certain persons and will get certain information as a result.
We have had a most valuable debate and we have learned many lessons as a result of it. It shows the need perhaps not only for the continuing scrutiny which the PAC gives but also for the changes which have been suggested and which we shall need to look at a little more urgently than we have been doing over the past year to make sure that this valuable work at least keeps pace with new and emerging problems which confront us.

Question put and agreed to.

Resolved,
That this House takes note of the First, Second, Third, Fourth, Fifth and Sixth Reports from the Committee of Public Accounts in the last Session of Parliament and of the Treasury Minute and Northern Ireland Memorandum on those Reports (Command Papers Nos. 6654 and 6653).

Orders of the Day — NORTHERN IRELAND (APPROPRIATION)

10.0 p.m.

The Under-Secretary of State for Northern Ireland (Mr. James A. Dunn): I beg to move,
That the Appropriation (No. 3) (Northern Ireland) Order 1976, a draft of which was laid before this House on 8th November 1976 in the last Session of Parliament, be approved.
The order is being made under paragraph 1 of Schedule 1 of the Northern Ireland Act, 1974.
The Main Estimates for 1976–77, totalling £1,038 million, were provided for by the Appropriation (Northern Ireland) Order 1976 and the Appropriation (No. 2) (Northern Ireland) Order 1976, which were approved by the House on 11th March and 23rd July 1976, respectively. The order now before the House seeks the appropriation out of the Northern Ireland Consolidated Fund of a further £61 million, this being the sum covered by the Autumn Supplementary Estimates. This would make a total provision for 1976–77, to date, of £1,099 million, some £71 million more than the total Estimates for 1975–76.
The services for which extra provision is needed are specified in the schedule to the order and are set out in greater detail in the Autumn Supplementary Estimates, which have been available to hon. Members in the Library. I should like to summarise why this extra money is needed. £61 million is being sought; about £38 million, or 62·3 per cent., is for pay and price increases, all of which conform with the Government's present counter-inflation policy, and £23 million is accounted for by policy or timing changes.
Apart from pay awards, the most important elements of these Supplementary Estimates are: £11 million, which is required for assistance to the ship-building industry, and which represents a bringing forward to within this financial year of requirements previously envisaged for later years; higher supplementary benefit payments, which account for £9·5 million, and increased claims on the temporary employment subsidy, which total £5·3 million. Also £4·5 million is for additional road improvements and maintenance and £4 million


for the purchase of shares in Short Brothers and Harland Limited in the capital reconstruction of that company. There is also a provision of £2 million for compensation for price restraint.
The original estimate of £26 million represents the deficit on electricity and gas undertakings for the financial year 1975–76, and the provision now sought represents interest thereon to cover the period until the date of payment. As well, £2 million is provided for further payments under the Special Land Improvement Scheme and it is anticipated that a further Supplementary Estimate will be required to complete payment of claims which have been submitted under the scheme.
Against these increases may be set reductions, which include £4 million in factory building provision and £5·8 million in industrial development grants.
The financial adjustments made necessary by the creation in Northern Ireland of the Department of the Civil Service are detailed in the Schedule to the order, and are reflected in the Supplementary Estimates.
These are the main features of the order to which I wish to draw attention. I commend the order to the House. I shall of course try to answer any questions that hon. Members may wish to raise in the debate, and if for any reason I am unable to do so I shall note the point and write to the hon. Member concerned, as is the general practice and custom of the House.

10.5 p.m.

Mr. Airey Neave: I should like to thank the Under-Secretary for his brief but coherent explanation of the order. I have quite a number of questions about it. We realise that this money has to be raised. The greater emphasis that is being placed by the Secretary of State on the economy of Northern Ireland at present makes the Under-Secretary's statement most important.
Let me begin with a matter of which I have given the hon. Gentleman notice, that of agriculture in Northern Ireland under Class I. In recent weeks we have been able to study the Quigley Report, which contains a great deal about agriculture. According to the report, employment

in agriculture will fall by about 12,000 jobs between 1975 and 1982. In the circumstances that is a serious fall. I think it is something over 10 per cent. The report states that a programme of job stabilisation should be devised at a cost of £21 million per annum at current prices. The compilers of the report refer to:
an appropriate packet of measures",
but they do not say what that means. They in no way describe what those measures should be.
I hope that in his winding-up speech the Under-Secretary will say something of what he has in mind to deal with agriculture. The question arises—it was asked in the Quigley Report—whether Northern Ireland agriculture should have a regional dimension or whether it should be seen as a part of United Kingdom and Common Market agriculture. It is difficult to get guidance from the report about where policy should lie, and therefore we must ask the Government what long-term plans they have for Northern Ireland agriculture.
The most immediate concern is the problem of the Northern Ireland meat industry and the Green Pound. The Secretary of State made a statement on that, not in the House but in a Press release, on 19th October. He introduced then a scheme to meet the disparity between the level of the Green Pound in the United Kingdom and that in the Republic. I understand that the right hon. Gentleman has now extended this scheme to February 1977. This information was given in a Written Answer.
When it was first introduced, the cost of the scheme was said by the Secretary of State to be £1 million over the short period of about a month. What will be the total cost of the Meat Industry Employment Scheme, as it is called? Does the sum of £2 million recorded under Class I(3) in the order relate to the scheme? We should know what plans the Government have for dealing with the whole problem after February 1977.
I do not know whether the Under-Secretary is confident on this score and whether he has spoken to the Minister of Agriculture. How confident are the Government that they will get amendments to the common agricultural policy? What will they do about this scheme in


terms of the circumstances surrounding the Northern Ireland meat industry? If they were unable to find a solution, would they agree to devalue the Green Pound or would the scheme have to be extended beyond the February 1977 limit announced by the Minister in the middle of November? No doubt hon. Members from Northern Ireland who are interested in agriculture will press similar points. May I also ask whether the smuggling about which we are concerned has decreased since the scheme was introduced?
I turn now to Class II, which relates to the Government's industrial strategy in Northern Ireland. I said earlier that I understood the Secretary of State to be concentrating more on the grave economic situation in the Province. I have studied the Quigley Report, but it does not appear to contain anything about a clear industrial policy for the future. I do not get much guidance from the report. What are the Government doing about it? What are their intentions? If the situation is as serious as the Quigley Report suggests, the Government should be preparing some firm proposals to deal with it.
I am sure that the Government are aware of the strategy suggested in the report, at page 68, that the State should be
largely but not solely in a supporting role—enabling jobs to be maintained which would otherwise be lost; encouraging industry to bring forward its recruitment plans; developing the Province's asset of skill; and creating jobs through direct labour schemes or projects for employment in the manufacturing sector.
That is a strategy of a kind chiefly for job stabilisation. That is all that the report suggests for a strategy. Do the Government agree with that? If so, what action do they propose to take within the very near future, because this matter is becoming extremely urgent?
In view of recent newspaper reports—I think that this appeared in the Irish Times at the beginning of November—the Government are having difficulty in securing the financial allocation thought necessary for the implementation of such measures as were suggested in the Report. The Opposition do not want to create any difficulties in regard to this matter. However, we want to know what remedial

measures the Government have in mind for dealing with the current position.
I turn next to the energy situation. This is another crucial problem for Northern Ireland and it is dealt with at page 30 of the Quigley Report. Energy costs in Northern Ireland are astronomical. Increases in gas and electricity costs since 1973 have been higher and have risen faster than anywhere else in the United Kingdom. On 23rd July my hon. Friend the Member for Epping Forest (Mr. Biggs-Davison), who questioned the then Minister of State on this subject was told that the Shepherd Report on the electricity supply industry had been completed and would be published "within the next few weeks". When will it be published? If it is not to be published, may we be informed of the Government's policy for the electricity supply industry in Northern Ireland?
What has happened to the parallel study commissioned by the Government on the gas industry? Several of my hon. Friends and hon. Members from Northern Ireland have been asking about that subject in recent weeks. Should there not be early publication of and action on these reports since the problem was highlighted in the Quigley Report as one of the areas where positive action by the Government could be of most immediate help? I am speaking not of a long-term strategy, which is not clear from the Quigley Report, but of something which the report suggests is urgent.
I turn next to page 52 of the report which relates to Harland and Wolff. I gave notice that I proposed to raise this matter. I am sure that Northern Ireland Members will wish to know about it. The Quigley Report appears to reconcile itself to a substantial reduction in the ship-building work force within the next two years. Many of us have visited Harland and Wolff recently and seen the excellent machine shops there. I should like to know what plans there may be or what discussions there have been within the Government and the company regarding alternative engineering products, what diversification is taking place and whether it has shown any results. Would it not be helpful to the work force to have a frank assessment of the realities as soon as possible? The Government should be considering them now in view


of what is contained in the Quigley Report.
I know that there have been unofficial discussions between those visiting the yards and those involved in the problems. Have the Government considered whether a defence contract might be due to the shipyard? Those who work there should be told as much as possible about efforts to help them.
A further issue which does not arise in the Quigley Report is that of Strathearn Audio. May we have a statement on the position of that company in the light of the Touche Ras Report. Is there any revised strategy for it, and is the firm expected to show a profit? Will the Minister ensure that social considerations do not totally override commercial considerations, particularly when considering the management board?
My final point on industrial strategy and policy does appear in the Quigley Report—the hint that, as tax incentives will be necessary, there should be a tax "holiday" on exports in Northern Ireland, as in the Republic. That is not a direct recommendation but, like most matters in the Quigley Report, it is vaguely referred to as a possibility. We should like to discuss that with the Government, and I hope that the Minister will refer to it when he replies.
My final point concerns Class VIII, education. I do not want to go into that at great length as we need to have further debate, as all hon. Members connected with Northern Ireland will agree. Big issues are involved in Part II of the consultative document on secondary education—the Cowan Report, which I have studied at length today.
Certain things in that report give rise for concern and need to be debated more fully than we have the opportunity to do on this order. As I understand the position the Minister of State, Lord Melchett, said in a Press release that the Government had extended the time for consultation until Easter 1977 and that they would not impose comprehensive schooling on Northern Ireland against the wishes of the people.
But the consultative document indicates that the Government are moving along predictable lines. This debate provides

us with an opportunity of firing a warning shot or two about the matter. The proposals for reorganisation in the report are fairly extreme compared with those already proposed for England and Wales, in spite of Government assurances. According to the Cowan Report, comprehensive schooling will include—this is a formidable phrase—many schools that are "virtually independent", the Group B grammar schools. These are the voluntary grammar schools listed in Appendix C—Campbell College, Dominican College, Belfast, the Royal Belfast Academical Institution, and St. Dominic's High School. They are virtually independent and receive capital expenditure grants only on works related to school meal accommodation. The Government have not taken that action concerning independent schools in England and Wales.
One of the two basic premises of the document is that in Northern Ireland—I quote from paragraph 2 of Part II of the report—
The role played by independent schools is insignificant".
That is the key to the thinking behind the report. I find the language interesting but rather disturbing. Under this scheme there will be universal comprehensive schooling in Northern Ireland. The variety and choice which it is suggested should exist might be seriously diminished.
These are first impressions. No doubt the Minister will tell us what the Government have in mind. Will he tell us how much the reorganisation will cost? The document estimates that it would cost around £4 million additional capital expenditure at a conservative estimate and £1¾ million per annum in grants. Is this really the time to be proposing such additional expenditure? That is a reasonable question to ask and I hope that the Minister can give us an answer. Although there is time for consultation—until Easter of 1977—the fact that the document has been published in this form with these suggested arrangements and with this blueprint in such definitive form is an indication of the Government's thinking.
I am sure that the House will wish to thank the Minister for the way in which he has introduced the order. We shall


look forward to his answers to our questions.

10.21 p.m.

Mr. Robert J. Bradford: I wish to refer to Class II, item 1 of the Order. It is singularly appropriate that we should be debating Northern Ireland shipbuilding in the wake of the marathon debate on the Government's nationalisation proposals for shipbuilding in Great Britain. It will be recalled that at the end of that debate Harland and Wolff was still excluded from the Bill. This undoubtedly causes some problems for those who have the interests of Harland and Wolff at heart. According to the Government it is clear that there is to be a national policy for ship-building in Great Britain—Great Britain, not the United Kingdom as a whole. If that were so Harland and Wolff would be included in the nationalisation proposals.
An amendment was accepted by the Government to consult Harland and Wolff and the board of that company but there are no statutory obligations to involve that board in questions of planning, strategy and marketing functions. We would be failing in our duty if we did not highlight the absurdity of a Government-controlled body, namely British Shipbuilders, competing against another Government-owned body, Harland and Wolff, for the gleanings of world ship-building and ship repairing.
It is important also to underscore the way in which Harland and Wolff is disadvantaged in terms of marketing alone. Here we have the marketing team of one facet of United Kingdom industry facing massive competition from the marketing techniques of the new giant shipbuilding board. Notwithstanding the massive aid given to Harland and Wolff to date it is still incumbent on the Government to assist the Northern Ireland shipyard in a way which will inspire confidence and boost morale rather than in a way that simply puts the yard in receipt of charity. The aid should be given in a way which will enable the yard to face the future with some degree of confidence and hope.
This can be done in at least three ways. First, the Government could consider the possibility of appointing a Harland and Wolff director to the board of British Shipbuilders. I understand

that there is a vacancy on the board. What greater boost to the morale of the yard could there be than such an appointment, placing a Harland and Wolff director at the centre of national policy decision-making for the United Kingdom shipbuilding industry? The second way in which morale could be boosted would be by granting Ministry of Defence contracts. The hon. Member for Abingdon (Mr. Neave) alluded to this earlier.
It is interesting to note that in 1974–75 about £94 million was spent on Ministry of Defence contracts and almost £13 million for ship repair contracts under the Ministry's control. Since 1970, Harland and Wolff has not received a shipbuilding contract from the Ministry. It might be calculated that over the five years about £600 million has been spent on such work, but Harland and Wolff has not received one order from it. It has received 15 ship repair contracts, having tendered for 55. Is there not here another possibility for boosting morale in the yard as well as making its profitability an attainable goal?
The third way in which assistance could be given to the yard is by a realistic scheme of diversification. Some years ago, it attempted to produce custom-built houses, which were exported to the mainland. The fault did not lie with the project but with the fact that it was before its time. The houses were exported from the Province but now we are beginning to use a similar type in Northern Ireland in order to help alleviate the housing problem. Diversification may be a possibility in that sort of way, but I am informed by those who work at Harland and Wolff that diversification must, if possible, be within the orbit of ship repair and shipbuilding.
In July, Questions were put to Northern Ireland Ministers by the hon. Member for Newbury (Mr. McNair-Wilson). He is not here tonight, but he has shown a marked interest in Northern Ireland, particularly its industry. The answers to his pertinent Questions were promised during the debates on the Aircraft and Shipbuilding Industries Bill, but they never came. For example, he asked whether the £60 million we had heard about in August 1975 was the last financial aid to shipbuilding in Northern Ireland, whether it was enough to meet the


problems which the yard had encountered since 1975, or whether extra money was to be made available, perhaps through the Industry Act. These are important questions, and if we got the answers tonight, again we might find the work force at the yard boosted in morale and gaining a renewed confidence in the future of the concern.
It would be wrong to leave the subject of Harland and Wolff without making a comment about the work force. In 1974, we were told that its output was 70 man-hours per ton. That has now been reduced to 46, a creditable performance. It is clear that the workers are prepared to play their part in renewing their industry, and we ask the Government to make some kind of statement or declaration, or, better still, a positive movement of intent which would encourage the work force at Harland and Wolff.
The former Minister of State, Northern Ireland Office, the right hon. Member for Salford, West (Mr. Orme), repeatedly referred to the need to widen the economic base in Northern Ireland. Northern Ireland represents approximately one-fortieth of the population of the United Kingdom but, unfortunately, it does not enjoy a proportionate share of the Kingdom's industrial life. I ask the Government to pay attention to that comment made by the right hon. Member for Salford, West, and to show that they are concerned to widen the economic base in the Province.
I underwrite what has been said about the Quigley Report. The report was indefinite. Industrial relations in Northern Ireland are second to none. Our work rate is second to none in the Kingdom. We need opportunities to put those attributes into practice. I do not know whether those opportunities are to be found in the auto-engineering industry or in some light engineering product. It is for the Government to prove that they will widen the economic base and reduce dependence on the traditional industries, almost all of which are suffering recession.
Is the £50 million available to the Northern Ireland Development Agency enough to introduce the new industries which are urgently required? I am no great advocate of nationalisation or Government

control, but economic confidence in Northern Ireland is at an all-time low. The Government cannot have it both ways. Over the past three or four years they have refused to keep in the Province defence establishments which are entirely under their control. They have refused to encourage Rolls-Royce to keep part of its operations in Northern Ireland. If the Government, because of lack of confidence in the economic future, cannot go to America or Europe and offer a skilled work force in Northern Ireland capable of doing whatever needs to be done, they will have to provide money through the Development Agency for the wide industrial base which the Province requires.
We would prefer the Government to do the former and to underwrite their confidence in the future by keeping in Northern Ireland the defence establishments and Rolls-Royce and inviting industrialists in Europe and America to come and join us. If they cannot do that, they must let us have more money to provide jobs in the Province through the Development Agency.
The unemployment statistics are appalling. About 56,000 people are unemployed in the Province. We heard today that Stephen Bros. of Omagh will have to part company with 250 employees in March next year unless there is a radical change in the textile industry. I am not an advocate of import controls. I do not ask for the profligate application of import controls, but I earnestly believe that unless some short-term measure, or selective control is exercised—particularly in the textile and shirt industries—many thousands of jobs will be lost to Northern Ireland in the near future.
The Government should not be tempted to offer aid to so-called co-operative groups in West Belfast to keep the Colin Glen bacon factory in existence. Such groups, willingly or unwillingly, become tools of the IRA and are used to mask the financing of the IRA through legitimate business. This money finds its way into the hands of those who purchase bombs and bullets to destroy Northern Ireland's industry.
The Colin Glen bacon factory could have a future, with a slightly reduced work force, if its functions reverted to those for which the factory was created


—namely, the slaughtering and cleansing of carcases and their distribution to other establishments which carry out the small goods operation, the cutting of the car-cases into loin chops and so on.
I am concerned that the Unipork Group, part of which is a London-based firm, which always had an interest in the Cookstown operation, but never in the Enniskillen operation or in Colin Glen, seems to be tending towards centering all its activities in Cookstown. That would be very helpful for my hon. Friend the Member for Mid-Ulster (Mr. Dunlop), but it would mean the loss of a factory in West Belfast and, possible, the future loss of a factory in Enniskillen.
Why has the Colin Glen factory apparently been run down? The Pig Marketing Board and the management of Colin Glen say that pigs were not available. If that were so, why were pigs exported to Japan? Why is a senior official of the Pig Marketing Board proposing to go to Poland to sell produce? Why were pigs not bought from the 10 per cent. that the PMB has for sale to any of its factories after quotas have been met? Why were pigs not bought from the Republic for Colin Glen, as they were for other factories? All this leads me to ask whether there was a deliberate rundown of Colin Glen.
Certainly this latest proposal—for the takeover of Colin Glen by a West Belfast co-operative group—poses an even greater threat to the people of Northern Ireland. The Government should not be party to financing any such proposal and they should ask the PMB to look again at the possibility of fitting Colin Glen into their total operation.
We do not ask for charity for Northern Ireland's industry. We have suffered in the past from the mismanagement of Harland and Wolff and mismanagement of the PMB. The people of Northern Ireland are waking up to the fact that they can secure their future if they are given a lead by the Government and by managements. That is what we are pleading for tonight.

10.40 p.m.

Mr. John Dunlop: Following what my hon. Friend the Member for Belfast, South (Mr. Bradford) said about the closure of Stephen Bros, which has been announced tonight, I wish to

point out that this will mean even more unemployment in my constituency.
I wish to concentrate on an area of underemployment rather than unemployment. The shortage of staff in small acute hospitals west of the Bann is a problem of immense magnitude. Indeed, the National Health Service is crumbling in West Ulster because of this problem. The Tyrone County Hospital has to close its casualty department at five o'clock every night because of the lack of qualified staff. This is an awful situation in an area where we have the usual accidents in the home and on the roads and, in addition, the bombs, bullets and fires of the terrorists.
Some of the money used on other projects—big recreation centres, for instance—could have been better employed in encouraging consultants to come to our remote part of the United Kingdom. We must offer them attractive rewards to work there. Radiologists have to be brought to the Tyrone County Hospital from the Altnagelvin Hospital in Londonderry. There is not even a radiologist at the Erne Hospital in Enniskillen. If a person is seriously injured in a fire, an accident or in some other calamity, he has to be taken to Londonderry for an X-ray or the radiologist has to be brought out from the city. Medical staff who come to work in our remote area sacrifice much in the way of cultural facilities and they should be given financial encouragement to move there. I have been told by medical staff in the area that during their month's leave, they work in Europe, Canada or the United States where they earn enough to keep themselves and to bring back about £1,000 towards, as they say, the purchase of next year's car. That illustrates the big difference in what they can earn here and overseas. If we made the rewards greater, it would attract more staff.
I wish to mention the threatened rundown of certain hospitals. I wish particularly to mention the Mid-Ulster Hospital at Magherafelt. A deputation representing the Magherafelt and Cookstown District Councils went to Stormont Castle to see the Minister to put the claim for retention of the hospital as an acute hospital. Unfortunately, the Minister would not see that deputation and


they had to be content with an interview with a secretary. That is a bad state of affairs.
One of the men who led the deputation was an eminent and recently retired surgeon, Mr. Wilfred Brenner, former house surgeon at the Mid-Ulster Hospital. Mr. Brenner gave the hospital his services at great sacrifice to himself because he could have taken better posts elsewhere at a far higher salary. But he chose to stay in that small town and gave a lifetime of service in the hospital. He was one of the group that went to meet the Minister, but he, along with the other representatives, was not given a hearing at Stormont.
I believe that attention should be paid to the claims of the Mid-Ulster Hospital, which serves a wide area. The hospital serves a population of 70,000 to 80,000 people. It covers a wide geographical area and it is an indispensable unit in the health service of Mid-Ulster.
I hope that the Minister in replying to the debate will give favourable consideration to implementing my suggestions.

10.47 p.m.

Mr. James Kilfedder: If all the reports about local and central Government overspending are to be believed, the £60 million in the autumn Supplementary Estimates for Northern Ireland represents a lower proportionate increase than that expected for social services in the rest of the United Kingdom. It highlights the fact that Northern Ireland is not being fairly treated.
Since the Province is now being crucified by terrorists and hate mongers, the Government should extend a helping hand to the people of Northern Ireland—but they are not doing so. Earlier this year cuts were made in the public expenditure programme in Northern Ireland. These cuts were £25 million more than they should have been on the strictly equivalent basis compared with the rest of the United Kingdom.
We must also add a smaller addition to the main Estimates than the rate of inflation would seem to warrant. The rate of inflation—price and wage increases—would suggest a larger Supplementary Estimate for Northern Ireland

than £60 million. A figure of £60 million is probably what one would expect to cover increased salaries and wages for people on the public payroll. But presumably it is also meant to cover increased prices. Has the effect of price increases been under-estimated, or has there been a ministerial edict to curtail the Supplementary Estimates?
I turn to Class II, No. 4 on the subject of energy, in which an extra amount of £2,040,000 is needed by way of compensation for price restraint. I welcome this move, as would any person representing a Northern Irish constituency. Electricity and gas charges in the Province are a very heavy burden on all families. In some cases it is too great a burden, particularly for old people, who cannot understand the price inflation of electricity and cannot properly control the consumption of electricity in their all-electric homes.
The cost of electricity and gas—certainly of electricity—is about 40 per cent. higher than in Great Britain. Again, Northern Ireland is suffering. Why should Northern Ireland suffer, since Governments at Westminster have always said that they would deal with all parts of the United Kingdom with an even hand? In particular, the Labour Party, when out of office, has always emphasised this principle. Yet here we have Northern Ireland suffering more than it should.
The hon. Member for Abingdon (Mr. Neave) referred to the Quigley Report, and rightly so. Certainly the Government must act immediately in helping industry by making electricity and gas available more cheaply, if we are to have more jobs created and more people taken off the unemployment register. Perhaps I might deal with the unemployment problem at a later stage. I noticed, incidentally, that £40,000 has been met from the Civil Contigency Fund. Perhaps the Minister will tell us for what purpose this money was used. Is it compensation for the recent fearful attack upon the Belfast gasworks, to tide it over until compensation is paid? That may or may not be the reason.
With regard to compensation, I should like to protest about the inordinate delay in payment of compensation for damage caused by terrorists. It does not matter


whether it is an individual or a large firm, great suffering is caused. But the individual suffers most. Very often he has not the money with which to replace what has been damaged, whether it is a house or a motor car. If his car has been damaged he has to get it repaired by a garage. He cannot wait a long time until the compensation comes through. I do not see why an individual should bear this burden and be penalised because some terrorist has damaged his home, his property or his car. Perhaps the Minister will look into this and ensure that payment is made as quickly as possible.
I welcome the extra £2,250,000 for new road construction. Certainly the road programme provides much-needed employment, and it is also important for industrial development generally. But I find it extraordinary that there is no change in the £6,944,000 needed in Class IV No. 1, for the operation and maintenance of roads.
I do not know whether the Minister has had the opportunity and pleasure of travelling around my constituency on the roads of North Down. If he has, he will know why I am complaining about the state of those roads, but I will come to that complaint in a moment. There has been no extra provision in the Estimates, despite the fact that there was an increase in wages of 5 per cent. from 1st November. Does this mean that some men have been paid off to keep the cost within the original Estimate? I have heard that 400 or 500 men have been or will be dismissed as an economy measure. I hope that the rumours are not true, and I look forward to hearing from the Minister on this point.
The roads in North Down are in a highly unsatisfactory state and in places they are in a very dangerous condition from lack of repairs, lack of realignment of corners, or lack of other necessary work. The roads are not fit to take the extra traffic that uses them. They are in an area that has developed rapidly. The population has increased and there are many tourists. Something should be done to improve the roads. I hope that the Minister will take action.
I turn briefly to education. I shall not go into the matters that were canvassed

by the hon. Member for Abingdon (Mr. Neave). A mistake appeared in one of the questions in the second verbal reasoning test in the 11-plus examination held last week. I regret that a mistake was made. Happily, unlike other occasions, I understand that it has been decided by the Minister not to ask the children to resit the examination. I agree with that decision wholeheartedly. However, I question whether the Minister is right in making an adjustment to the marking of the paper to take account of the error in the question. It was a five-part question and a child would have spent some time in trying to understand the question and to provide an answer. That would leave him less time to deal with the remaining questions. In other words, a boy or girl taking the second verbal reasoning test would be penalised for spending time in attempting to comprehend a question that made no sense. It is not the first time that an official document has made no sense, but it is hard to penalise youngsters for incompetence in a Government Department.
The failure to understand the question and to provide an answer goes further than using valuable time as it is bound to have an effect on the confidence of the pupil sitting the examination. It is bound to have an effect on how he or she deals with the remaining questions. I do not see how a reasonable or sensible adjustment in the marking of the paper will surmount the difficulties that I have pointed out.
I feel that the Minister came to too hasty a decision when he decided to make a marking adjustment, although no doubt he acted quickly so that no child would be afraid that he might have to sit the examination again. I believe that to be the reason for making such a speedy decision. There is just too wide a range of possibilities for a marking adjustment to meet the situation. I urge the Minister to take the view that the whole matter should be reconsidered. In my view the second verbal reasoning test should be eliminated, except where the marks for the second test are higher than in the first test. I add that important proviso because I have been told by my nephew and other children to whom I have spoken who sat the examination that the second test was easier than the first.
The failure of the Government to ensure that the roads in Northern Ireland are gritted, especially in North Down, is a disgrace. They have not been gritted at the right time and in the right place for the past few weeks. It is a foolish economy not to spend a few thousand pounds, or whatever the cost may be, paying overtime to the men who have to do this vital job if we wish roads to be safe and accidents to be avoided.
This morning there was ice on the roads in North Down. I can speak only for North Down, but my comments might apply elsewhere. No grit had been put on the roads. The men came out to put grit on the roads when people had already faced the frightening prospect of travelling on icy roads. I do not see why people's lives should be placed in jeopardy for the sake of a few thousand pounds.
I got in touch with the Minister a few weeks ago and took up this matter with him. I am sorry to say that as yet I have no satisfactory answer and that there has been no action. This brings out yet again what I have always said: until we have devolved government at Stormont, we shall never be able to get a quick answer and some quick action in a matter of this kind.
Last Monday, my own car swung round on the road approaching Newtownards. Other cars swung round, and two accidents occurred, and only then was grit placed on the road. To be effective, gritting should be done during the night or before nightfall.
All the items mentioned in the Supplementary Estimates emphasise the cost of recent pay and salary awards. But lowly-paid staff in the public service, many of whom work part-time, receive less than £2·50 a week by way of an increase. When income tax and the increased national insurance contributions are paid, in many cases employees receive less than a £1 increase. Surely that is an insult to a man or woman who is doing a decent job of work. It is an intolerable situation when it is extremely difficult to meet the high cost of food and clothing.
I deal finally with the unemployment situation. It is extraordinary how, when the Labour Party was out of office, it

attacked everyone connected with Northern Ireland for the disgraceful state of unemployment then. Now that we have had three years of this Labour Government, we have the highest unemployment figures since the war. Surely this Government will act, and act now.

11.1 p.m.

Mr. McCusker: I want to comment on a number of items under a range of headings in the Appropriation Order and, to begin with, I turn to Class II.
I congratulate the Under-Secretary and, through him, his hon. Friend the Member for Birmingham, Northfield (Mr Carter) who is responsible for the Department of Commerce and who, with his officials, has succeeded in attracting for the first time for seven years an American industry to establish itself in Northern Ireland, and in my constituency. I was scathing in my criticism of officials of the Department earlier this year when, following an announcement that the authorities in the Republic had managed to attract a number of American industries, we appeared signally to have failed.
I hope that those officials will now realise that, having overcome what may have been a mental barrier, there is no reason why they cannot get more industry to come. I notice that the Under-Secretary is smiling at that comment. I might perhaps remind him that all the reasons in the world can be advanced for not attracting industry to Northern Ireland and that, once they are, the only certainty is that there will be no success. The Department has had some success now. Let its officials go out and follow it up. But it is good that they have attracted an industry which slots rather nicely into a growing carpet manufacturing sector of our economy. We wish it every success.
I add one or two words of caution. Many companies have come to Northern Ireland and suffered for years before getting on to a viable basis because they have not understood some of the problems. I worked in North Armagh with a very large American company—perhaps the last one to come before this—and I suggest that the hon. Member for


Northfield be advised to tell the management of the new company to go and talk to the management of the other one, if that has not already happened. There are lessons to be learned from any organisation which has undergone the trauma of establishing a new factory in Northern Ireland, and I believe that many of the mistakes which were made by previous newcomers can be avoided. Certainly I shall do all that I can to help. I hope that the Minister will see to it that some action is taken on my suggestion.
It is notable that one of the reasons for concern was the availability of advance factories. While, no doubt, there is value in having an advance factory programme, there are also disadvantages, because it can be very soul destroying to pass rows of empty factories. One must decide where to draw the line. I hope that the Minister will look at the advance factory programme. It appears that there has been some reduction in the programme, and I hope that that means there is adequate provision and a likelihood of them all being filled. I believe that the money invested in advance factories might be better invested elsewhere during this period of economic restraint.
There is a need to consider local indigenous industries. Many of them feel that new industry coming into the Province gets preferential treatment over established industry. I am not saying that is true, but many industries do feel that. Many industries which turn to the Local Enterprise Development Unit for assistance say that they cannot establish a working relationship with that organisation. If this feeling exists in the Province it should be taken into account, and something should be done to improve that relationship.
My hon. Friend the Member for Belfast, South (Mr. Bradford) mentioned the drastic unemployment situation in Northern Ireland. I am interested in the projection for unemployment this winter. There is at least one hon. Member on these Benches who has suggested that unemployment could reach 80,000. God forbid that it does. But if that figure is being mooted by Northern Ireland Members, we want to have it confirmed or denied by the Minister. I hope that he will deny it tonight.
Part 4 of Class II expenditure of the Department of Commerce relates to compensation for price restraint. I believe that part of this will go to the various gas undertakings. Reference already has been made to our energy problem. While the gas undertakings will welcome compensation for pegging their prices, it should be remembered that they are pegging them at a rate which is 300 per cent. higher than the going rate in Britain. I hope that allowance has been made in the Estimates for an amount of money which will enable the gas concerns to sell their product at roughly the same price as that operating in Britain. If it is not the intention to offer some assistance to these concerns, some of them will not be in existence for very long.
I speak with some authority on this matter. I have three gas manufacturing concerns in my constituency, two of which are private companies. The third is owned and administered by the local district council, and is on the verge of bankruptcy at the moment. It has told me that unless something is done, it will go out of business, and the consequences of that are too horrible to contemplate. I hope that allowances will be made to help gas manufacturers reduce their prices so that they will be competitive with other fuels.
I turn to a rather parochial constituency matter which is covered by Class VI—the expenditure by the Department of the Environment. Has any allowance been made for the Armaghbrague water scheme in South Armagh, which was mooted some years ago, when Newry and Armagh agreed to introduce the scheme. It was shelved in the local government reorganisation and the Department of the Environment was left with the problem. However, when the Department applied its yardstick, it said that the scheme would be too expensive on a cost basis because the scheme would apply to only 70 consumers. But those 70 people are all hill farmers. They are highly efficient and they are making a major contribution to the economic life of Northern Ireland. They tell me that they have always paid their rents and their rates, and they have tried to make the country viable. They are not prepared to go without water, and they are at present forced to carry it several miles


to water their cattle, cool their milk, and so on.
What does one need to do in Northern Ireland to get a fair share of the cake? There may be a yardstick to guide the Department of the Environment, but in extreme circumstances there must be some discretion. I hope that every opportunity has been taken to study the grants available from the EEC and elsewhere which might be used to supplement the money already available so that these people may have their scheme.
When I first mooted the idea two years ago the cost was about £120,000. When it was priced recently this figure had doubled. It is obvious that if a decision is not made soon the water will never be provided for these people. I hope that is understood by the officials responsible. It is easy to underestimate the value of having running water when one has four or five taps around the house. It is easy also to say that we cannot afford to provide it for these people. But they have never had running water, and they need it. I hope that their case will be given full consideration.
I turn now to Class VIII and education expenditure. I welcome the measures announced by the Minister who is responsible for Northern Ireland education. We have been concerned at the suggestion that there are 700 unemployed teachers in Northern Ireland when we need to reduce our pupil-teacher ratio and when our schools should be making a major contribution to overcoming some of our social problems. I am glad that the Minister has taken action to alleviate the situation. I hope that those teachers who claim that they are unemployed will rush in to take advantage of what is being offered. It is a sad commentary that the Province, which prided itself on its high standard in mathematics, should find itself with insufficient specialist mathematics teachers. I hope that sufficient volunteers will come forward for the courses being provided to change that situation.
There is another problem arising from the excess of teachers. It concerns those people who sough to carry out their training in Great Britain, as distinct from Northern Ireland. The problem takes two forms. First, thereis the person who has finished at grammar school and wants to

train as a teacher in a college in Great Britain. When public expenditure must be cut, it is right that students in Northern Ireland should be told that only a certain number of grants is available and that when that number is exhausted no one else will get assistance.
There is also the category, however, of the person already in Great Britain from Northern Ireland to do a specialist course. It might be in music or some other subject which is not catered for in Northern Ireland. That person will want to get a teacher-training qualification before going home. I know of a case in which a young man has come to London to train in music. He has trained at one of the finest colleges here and has undertaken specialist coaching from a top-class organist. He is finishing his course and wants to complete teacher training in London before going home. That would hold many advantages. He could continue with his specialist music course while continuing with his teacher training.
But this man has been told to return in a few months. The authorities will not let him know what the situation is. Is that justified? People in this position must be reassured that they will get the necessary grant to complete their training in Great Britain. I hope that the Minister will deal with this point tonight.
My hon. Friend the Member for Mid-Ulster (Mr. Dunlop) referred to the crisis in the Health Service. The crisis is undoubtedly growing in rural areas outside Belfast. My hon. Friend highlighted the problem of dentistry in Mid-Ulster. The situation in County Armagh is comparable with that in hospitals in Mid-Ulster.
The Southern Area Health Board rates third in the United Kingdom in terms of the worst provision of dental service. Within that area there are places facing catastrophe. For example, in the city of Armagh there are four dentists serving a community of over 40,000 people—one dentist to 10,000 people. One of those dentists is getting on in years and may soon retire. That will leave the area with three dentists to cater for the dental requirements of 40,000 people.
In Craigavon there are 11 dentists for over 68,000 people. Recently some of


my constituents have informed me that they have sought appointments with dentists and have been offered dates 12 months hence. That is all very well for a person whose teeth are in first-class condition, because he or she can afford to wait that length of time, but for somebody in agony such an appointment is of no help at all. If in the same breath the dentist says "If you are prepared to pay me, I will see you tomorrow", one begins to ask a few questions. I understand that a dentist is within his rights in doing that under his contract. Indeed, he can refuse to see a patient if he wishes.
I am concerned not only with the present situation but with the future and whether we are failing to attract sufficient people into dentistry. I hope that, within the moneys mentioned in the order, some thought has been given to this problem. It is extremely serious. The thought of four dentists trying to serve the needs of 40,000 people appals me. The city of Armagh faces catastrophe in this respect unless help is forthcoming..
Finally, I turn to Class XI. I want to touch on public service training and
expenditure by the Department of the Civil Service on central management of the civil service.
This document, published in 1975 by the Public Service Training Committee, outlines the problem and future of training in Northern Ireland. I have a particular interest because I was in training. I cannot help but think that the budget allowed for public service training of £50,000 is a paltry sum. My budget in one industrial concern was in excess of that amount.
There are vast administrative empires in the public sector in Northern Ireland. What is required in those empires is not professional expertise, but management expertise. If we are to make our public sector more efficient and to reduce the number of personnel employed therein, we must improve management skills and techniques. Despite the severe unemployment situation in Northern Ireland, every newspaper, whether national or local, contains lists of advertisements for all kinds of staff in the public sector. I hope that serious consideration will be given to spending more

money than is currently envisaged on public service training.
According to my information, only four people are involved in coping with the training needs of over 130,000 people. In 1975 it was estimated that 132,700 people were employed in the public service. I know that there are people involved in training in some of the individual parts which comprise this figure, but the Public Service Training Committee has a manpower of only four. That is not sufficient. If we are to improve our management skills, we must make a proper investment. I hope that the Minister will comment on that matter in winding up the debate.

11.20 p.m.

Mr. Wm. Ross: One could say many things in connection with the order but I propose to restrict myself to the section in Class I that deals with expenditure by the Department of Agriculture on agricultural assistance schemes, food processing and marketing. The Minister will not be surprised to hear that I shall address myself to the problems of cattle and the meat industry. The problems of sheep and pigs must wait for another day.
I complain specifically about a problem which arises from the green pound and the difference in the value of the United Kingdom and Irish Republic currencies and the number of monetary units that they will purchase. It is strange that the currencies of the United Kingdom and the Irish Republic have the same value in normal life but when we move into the queer, artificial, half world of the green pound they have different values. That leads to inequities and difficulties for that part of the United Kingdom which has a land border with the Irish Republic.
When the United Kingdom failed to alter the value of the pound sterling against the unit of account to try to retain the cheap food policy that has prevailed over the years, they created a severe problem for the agricultural industry in Northern Ireland. In an effort to avoid that, the United Kingdom took certain measures to support the meat industry in Northern Ireland. The Northern Ireland meat industry employment scheme was introduced for an initial period of one month. It has now been


extended to three months and I assume that the extension will last indefinitely. Apparently the Government have not yet made up their minds about the long term and, therefore, that which was to be temporary has become permanent, at a cost of £12 million per year. Where will that £12 million come from? When I tabled a Question I was told:
Finance for the present scheme to safeguard the meat industry in Northern Ireland will be accommodated within the total funds already allocated to Northern Ireland for the current financial year."—[Official Report, 16th November, 1976; Vol. 919, c. 545.]
Later I was told that this money arose as a result of a shortfall of moneys already allocated. If that is so, it must mean that bad bookkeeping has caused so much surplus money to be floating around or that cutbacks in other specific areas have occurred. The Minister must tell the people of Northern Ireland where that money has come from and where the cuts have occurred.
We realise that the aim of the scheme is to safeguard employment in the meat plants of Northern Ireland. It was also a heaven-sent opportunity for the Government to avoid their duty to control the border between the United Kingdom and the Irish Republic. Since we came to the House, hon. Members on these Benches have raised the issue time and again. But the Government have failed to grasp the nettle and to deal with it. The aim of the scheme was to stop smuggling across the border, but it also concealed the inequity in beef prices between the United Kingdom and the Republic.
Since the measure is as artificial as the green pound, it has caused further inequities. I wish to deal with two or three of the resulting conditions. The conditions governing the cattle which became eligible are a great bone of contention between Northern Ireland farmers and the Northern Ireland Department of Agriculture, or, more specifically, the Minister who is responsible for agriculture.
We hear a certain amount about the variable premiums still remaining at 13 weeks. Since there has not been a variable payment made for several months and since there probably will not be any for most or all of next year, that does not cut much ice with anyone concerned with

the meat industry employment scheme. Cattle have to be in Northern Ireland for a period of 20 weeks—five months. This would have been acceptable to Northern Ireland farmers if that 20 weeks had applied only to cattle imported from 22nd November onwards. What do we find? The restriction applies to all cattle which have been imported from the Irish Republic and which were in Northern Ireland at 22nd November. This provision affects all cattle imported into Northern Ireland on or after 28th June of this year.
The Minister will be well aware of the difficulties that have arisen for the farmers as a result. The Department is fond of telling farmers to be good business men, to be careful about how they do their accounts, to work out precisely what it will cost and what their profit will be before they buy stock. Farmers in Northern Ireland have learned to do that fairly well. But it does not help to sort out the accounts and the amount of feed that will be needed if the Government change the rules half-way through the game. That is what has happened.
Many of the graziers who are finishing cattle do not have much winter feed. There are people who specialise in feeding cattle for the first half of the winter. They now find that they are stuck with imported cattle for nearly two extra months. This leads to beasts being brought to a marketable condition but having to be kept longer than necessary. Some of the cattle were ready on 22nd November and have had to be held for a further seven weeks, which can do no good to anyone, least of all the farmers and the meat trade.
I am aware that the Government have many other problems and battles to fight. I presume that many of these battles are with the Dublin authorities, who have certain problems with regard to their cattle. No doubt the Government have more formidable battles to fight in Brussels. It is utterly wrong, it is a scandalous position, that the farmers have, once more, to be the whipping boys for a political decision which has nothing to do with the realities of fattening cattle.
There was nothing to gain by this decision relating to the 20 weeks. The figure could easily have been kept at 13 weeks or, at the least, cattle in Northern


Ireland on 22nd November should have had a qualifying period of thirteen weeks. That, at least, would have put people in the position of knowing where they stood for the future.
Two further problems arise. When the meat industry employment scheme was introduced, payments made under it did not apply to livestock shipped from Northern Ireland to the rest of the United Kingdom. This led to two serious situations. One is that it has lowered the market price in Northern Ireland by removing an important part of the competition which existed in the markets. An examination of the prices of cattle in the markets of Northern Ireland over the past two months will reveal that the price has dropped sharply. It is also true to say that there are a number of vessels which ply in the live trade between Northern Ireland and Great Britain. There is a grave danger that at least one of these vessels will be withdrawn and possibly even sold, because of the small number of cattle now travelling across the North Channel. If one of these vessels disappears, what will happen when shipping facilities are needed in future? That is a problem that the Minister should keep in mind and do something to solve.
The plain truth is that the people of Northern Ireland who formerly bought their cattle in the South and shipped them across to the North are now in the Irish Republic, buying their cattle in the markets there, shipping them to Great Britain and picking up an MCA payment of 5p a pound, which makes it very worth while.
I shall be grateful if the Minister will give his attention to these problems and if he is not able to answer our questions tonight, will do so in writing as soon as possible.

11.31 p.m.

Mr. William Craig: At this time in the history of our country, with a public expenditure crisis, we in Northern Ireland find it very difficult to keep our priorities on a basis that makes us feel confident, simply because at this point there seems to be no long-term overall strategy for the social and economic development of Northern Ireland. Such policy as exists is based on a strategy worked out 15 years ago. Severe cuts

will have to be made in public expenditure. How shall we order our priorities if the Government are not more forthcoming in terms of an overall policy statement?
I appreciate that the Government have considerable difficulties to contend with and that most of their energies are taken up with the day-to-day rescuing of a deteriorating situation. I also acknowledge and appreciate that some worthwhile discussion documents have been circulated, and that we have been asked to give our opinions on this or that. But I am convinced that this is not the way in which to form a long-term strategy.
It is very difficult to form such a strategy when we have a question mark hanging over the institutions of government in Northern Ireland. I appreciate that the present Government are walking very carefully a tightrope that will leave open as many options as possible in the future.
I, who believe very strongly in devolution, would like to thank the Government for the care and consideration that they have shown in so managing our affairs that they do not prejudice devolution.
The hon. Member for Abingdon (Mr. Neave) put his finger on the point that I am trying to make, in terms of the reorganisation of education. Whatever one's view may be as to the best form of education, it is certain that reorganisation will be very costly. Is this the time to embark on reorganisation?
In Northern Ireland our big challenge is to make the Province an attractive place for manufacturing activity. It has never been in a worse position. At the moment it has no particular advantage over any other part of the Kingdom, and there are some very serious disadvantages, arising out of terrorism and the high cost of energy. The challenge now is to produce a blueprint that will instil confidence into would-be investors.
We need to give priority to the essentials for industrial expansion. That is a much broader task than is generally assumed. It is not just a question of providing basic services and a pool of labour. One of the biggest hurdles we have to overcome is in improving the


overall living environment. There is increasing difficulty in attracting senior executives to posts in Northern Ireland. Many of our skilled executives are leaving the Province. A balanced blueprint —an up-dating of what was born out of the Matthews Report and the Benson Report—would make it easier to order our priorities.
There is one big change. Belfast is no longer the powerful magnet it was in the days when I was Minister of Development. A great deal of thought will have to be put into how we re-establish Belfast as an important commercial centre. Its re-establishment will enable the rest of the Province to develop at a faster pace. There is confusion about the eventual transport system within Belfast. I have read the Government's consultative document with great interest, and no doubt we shall have an opportunity to study it at greater length on another day, but I find the document totally unsatisfactory. It seems to miss the real needs of Belfast and the Province at large.
The recent Government statement about the switch of emphasis on housing, however, is a plus for the Government. For too long the housing policy of Northern Ireland has not been directed towards urban renewal or urban conservation. I hope that that switch of emphasis will result in a speedy improvement in Belfast, which is where the problem is most acute. Anyone who knows my constituency can see with alarm the increasing rate of deterioration at the city end of the constituency.
It is all very well to declare a switch of emphasis. Do we have in the Housing Executive the capacity and the right sort of machinery for doing the job? I have come to the conclusion that the Housing Executive has been the biggest Government blunder for many years. Its present housing programme looks like being 25 per cent. short of its target this year. There seems to be a great deal of incompetence. I cannot understand some of the contract figures we hear of from time to time. The cost of housing in the Province is almost as high as is the cost of housing in the most expensive part of this Kingdom. We were told that centralisation into the Housing Executive would mean great economies and bulk buying, but some Housing Executive houses are

more than double the cost of local authority houses. Public expenditure is such a burning issue that we need to look again at how things are done. I believe that there is a case for the decentralisation of the Housing Executive.
It is easy for me to say that, but it is not so easy to be constructive in suggesting how it should be done. The system of local government is bordering on the farcical. It was designed for a situation that no longer exists. We are all conscious of that. I am not sure that it would be wise or prudent to reorganise it until we have sorted out the devolution proposals. I ask the Government to look closely at the way in which the Housing Executive operates and to put right its big mistakes.
The people who should have the final say on the character of housing required in a particular area are obviously the members of the district council. They are best fitted to decide the environment of their town and its needs, and not some committee sitting in Belfast working on paper plans. I know that consultation with the district councils is increasing, but consultation can mean a lot or it can mean nothing. Without being offensive or denigrating to the present members of the Government, I can think of many occasions when I have taken constituents to meet Ministers for the purpose of consultation and I might as well have not bothered. To be fair, present company should be excepted.
Another factor is the importance of Harland and Wolff and Short Brothers to the economy of Northern Ireland. As both are located in my constituency, it is a problem that I am never allowed to forget. I would like to thank the Minister of State, in particular for the most helpful way in which he has handled the problem.
Six months ago, the workers in both concerns were greatly disturbed not just by the market problems but by the structuring of their industries. I am happy to be able to say that recent exchanges have brought about a much healthier feeling of confidence in the future. That is particularly true of Short Brothers. The financial reconstruction did not please everyone. There was some anxiety in some quarters that it was a further indication of a British pull-out. But I have talked to the shop stewards' committee


in particular, and it is very satisfied with the results and with the assurances which have been given.
I, too, want to touch on the machinery for consultation with the industries in Great Britain. In the letter I had from the Minister of State on 22nd November, he said that as far as shipbuilding was concerned some progress had been made, and that the two chairmen and their respective managing directors had already met and had had a length exchange of views. Can we be told tonight whether this inaugural process of consultation proved satisfactory to both sides? I was unaware that it had started in shipbuilding until that letter. The Minister, or someone else, must be aware whether both sides felt that it would be practical to have meaningful consultation and coordination.
The same process is about to start with the aircraft end of the problem. I hope that the House will be kept informed because this is a vital point for the future of both Short Brothers and Harland and Wolff. There must be real co-ordination and consultation between Northern Ireland industries and industries in Great Britain. The statutory obligation in the Bill imposes a duty, but it does not indicate or suggest how that duty should be carried out and how its effectiveness may be tested. Workers daily put questions such as those to me. I hope that the Government will continue with their present efforts to give a greater feeling of confidence.
As to the skills of this industry, I would like the Northern Ireland Office to bear in mind the pending closure of RAF Sydenham. I have made representations on a number of occasions about the skills and facilities that exist at RAF Sydenham. I hope that no time will be lost in exploring that situation fully, so that workers there will know whether there will be an opportunity for them in Short Brothers and so that Short Brothers will know whether they will have the use of valuable facilities at RAF Sydenham. If I could hope for a miracle it would be for the Minister to reverse the defence decision, but I do not think that I should waste the time of the House by hoping for miracles at this late hour.
I can understand the Government's approach to the industry of Northern Ireland

but it worries me. Emergency rescues often happen, and even the best merchant bankers in the world never feel happy about such operations. Because of the Government's desire to maintain employment in a very difficult situation they are justified, to some extent, in taking these risks. Difficult though it may be, I would like an assurance from the Government that they will not take too much of a gamble. I will not name the particular firms because that would be unfair, but I can think of one or two examples where, in the long run, Government aid could become a fiasco.
I will conclude on the subjects of transport, energy, and the road system. I do not enjoy the same transport facilities as Government Ministers in travelling to and from Belfast, and I have become increasingly dismayed at the poor quality of the service provided to Belfast, particularly by British Airways. There is virtually a monopoly. The Northern Ireland traveller does not have as many options open to him as the traveller to cities in, for example, Scotland.
If I were inviting someone to Northern Ireland in the hope that he might invest there, I should like to think that he would be impressed by the ease of getting to the Province. Unhappily, he is more likely to be frightened away than impressed. An approach must be made to British Airways or another airline to get a better service to Belfast. We should have a frequency of service which is more suitable to our needs.
I recognise the need to reduce to a reasonable level the number of aircraft flying from Heathrow, but I do not see why Belfast should suffer because of this problem. The TriStars would be far more useful operating to Belfast instead of to Glasgow. I hope that the Minister will use his good offices to provide us with a better air service.
We also need to examine our surface transport, not so much for passengers—though this is important for the tourist trade—as for goods. If a firm does not use containers, the transportation of goods to Northern Ireland is disgraceful. It is often the small firms—whose business does not justify the use of containers—who suffer. We must examine carefully the shipping services provided to Northern Ireland.
I was pleased to hear that the road programme is not being slashed too badly. I should like some indication of how the money will be spent. There seems to be a lack of coherent planning. Wonderful improvements are made to about 50 yards of a tiny rural road, but nothing more is done for generations. The standard of maintenance on our main roads is totally inadequate, and that is a false economy. Motorways are an expensive investment and should be maintained at the highest standard. I am disturbed by the way in which the M1 has been allowed to deteriorate. Part of the problem is increasing centralisation. The road executive cannot compare with the old system of sharing road functions between county councils.
The Under-Secretary will know of the controversy in my constituency which centres around the extension of the dual carriageway to link up with the Tillysburn junction. No one seems satisfied with the way in which the scheme is proceeding. Although the Government have made their position clear, there seems to have been a lack of communication.
No subject is giving me greater bother at present than the task of explaining Government policy on that dual carriageway. I wish to see a specific, firm, clear announcement and some timetable given to those involved. Perhaps I shall then be able to address my mind to other matters.
Since a number of hon. Members wish to take part in this discussion, I shall leave other matters to be dealt with on another occasion. I hope that the Northern Ireland Committee will meet soon, so that we may air the need for an overall strategy for the social and economic development of our Province. I hope that we shall have some assurance that we shall be able to debate the Quigley Report rather than simply send in our views to the Northern Ireland Office.

11.56 p.m.

Rev. Ian Paisley: It is regrettable that immediately this order is passed, other orders are due to come before the House that will probably go through in a few minutes. We are limited in our comments in these debates, and many hon. Members from Northern

Ireland will not have the opportunity to deal with important matters.
I am tempted tonight, in view of the situation, to filibuster on the other orders for the permitted 1frac;12 hours in order to make my protest felt. I deeply regret that we have not sufficient time to deal with these matters. I am sure that, with a little ingenuity, we could talk for a considerable time on noxious weeds.
I hope that my protest has been noted by the Minister. I know that he would like half-an-hour or so to reply to the debate, and I shall not stand between him and the House. But I wish to give notice that if this situation recurs—especially when we are dealing with important items of expenditure in Northern Ireland—we shall make our position felt as forcibly as we can.

Mr. Dunn: I have some sympathy with the hon. Member for Antrim, North (Rev. Ian Paisley) on this occasion; but I am sure he is aware that tonight's debate is taking place at the request of his colleagues, and that the decision was no doubt shared by him.
It has been the custom and practice that when orders are taken together and careful representations are made to the Chair, there is always flexibility in the matter of time. If the point is made to the Chair, its occupant can be flexible in making time elastic.

Mr. Deputy Speaker (Sir Myer Galpern): I see that, for some reason or another, I am being involved in an Irish dispute. The hon. Member for Antrim, North (Rev. Ian Paisley) should realise that a better time at which to make a protest was earlier in the afternoon when the House discussed next week's business. The Order Paper clearly sets out the proposals for discussion today. If the hon. Gentleman objects to them, this afternoon was the time to make his view known.

Rev. Ian Paisley: I do not wish to enter into controversy, and I think that I have made my point. I give warning that my colleagues and I will not allow Northern Irish business to go by default. This House is the only forum we have to discuss these matters. When we come to bread-and-butter issues, let it be seen that those who believe in the Union should take part in the debate and not those who wish to sec a break-up of the


Union. That needs to be put firmly on the record.
I agree with much of what has been said so far in this debate. I am not as thrilled as are some hon. Members over the situation at Harland and Wolff and Short Brothers. I should like to see those concerns firmly in the British family and not left in isolation. I should like to put that on the record. Furthermore, something needs to be done about the air services.
With regard to Waveney Hospital, a very serious position is arising. At a public meeting in Ballymena a few nights ago, the chief medical officer of the North-Eastern Board and the chief administration officer of the North-Eastern Board were faced by the chairman of the Medical Staff concerning the deterioration in after-care facilities in the Waveney Hospital and about promises, made to the medical staff, which have been broken. The two gentlemen both had to admit that there was a serious crisis in the Waveney Hospital. I have been waiting for six weeks to hear from the noble Lord the Minister of State, who is in charge of health and social services, about receiving a deputation so that this matter might be gone into and some appropriate action taken.
Six years ago it was decided that the Waveney Hospital should be an acute hospital for the whole North-Eastern Board. I have no idea why Mid-Ulster is in the North-Eastern area or why it was put there. It staggers me. There needs to be a hard look taken at the hospitals. I do not want to see any hospital run down in the North-Eastern Board. I want all the little hospitals still to continue to give the community the services it needs. But there must be one hospital which can provide intensive care and the other acute facilities which are needed.
That promise was made to Ballymena. It was reinforced and confirmed by the Minister's predecessor, who has gone elsewhere in the Government. Now we have all the past plans suddenly scrapped, and there is a proposal to put a hospital somewhere near to Antrim. I am opposed to this. I think that there is no possibility of a hospital being built for at least 15 years. But in the meantime the small hospitals are being run down, and the one hospital which can supply the service, the Waveney Hospital, is tonight in jeopardy.
I have facts in my possession which I do not want to make public because I do not want there to be any lack of confidence on the part of the people who attend that hospital. But things are in a state of crisis, and I implore the Minister to see his hon. Friend the noble Lord and to ensure that the medical staff who have requested a meeting with the noble Lord are given the opportunity to put their case to him.

12.4 a.m.

Mr. Dunn: In the short time allowed to me it would be impossible to answer, in the detail which right hon. and hon. Members would expect, all the very involved and complex issues which have been raised this evening. I ought perhaps to concentrate on a number of major issues in order to be able to give some detail in the answers which are being sought.
One of the major principles introduced into the discussion was raised by the hon. Members for Abingdon (Mr. Neave), Belfast, South (Mr. Bradford) and Down, North (Mr. Kilfedder) and the right hon. Member for Belfast, East (Mr. Craig). There is a great deal of misunderstanding about the basic principle of the Quigley Report. As most people will be aware, a team of civil servants was commissioned early in 1976 to carry out a survey of industrial and economic strategy in the Province. The review team was given a free hand to consult a wide range of interests and to consider all aspects of economic and industrial policy. The resulting report, which was published in October, discussed a number of strategic options. It generally concluded that more Government assistance to industry and involvement in the economy was necessary if Northern Ireland were to close the gap between its economic performance and that of Great Britain's.
The Government are anxious to involve the people of Northern Ireland in their own economic future. That is why such extensive consultations are being carried out on the proposals in the Quigley Report. Ministers are in close contact with such bodies as the Northern Ireland Committee of the Irish Congress of Trade Unions, the Northern Ireland Confederation of British Industry and the Chamber of Trade. In early 1977 it is hoped to set up a new forum to replace the old Economic Council and to bring together the Government and both sides


of industry in a meaningful and profitable discussion on the future of the economy.
The hon. Member for Abingdon referred to long-term measures. All the long-term measures and recommendations in the Quigley Report especially on agriculture, are widely recognised by members of the Government. We all accept the contribution that agriculture makes to the economy. The Quigley proposals will be considered in the context of the regional problem and United Kingdom agriculture as a whole. We do not wish to divorce the two, but there is a regional identity that must be maintained.
The hon. Gentleman also referred to a tax holiday. This afternoon in another place my noble Friend the Minister of State, Northern Ireland Office, gave an Answer on the tax holiday proposal which forms part of the Quigley Report. This suggestion will be carefully considered in all the consultations that take place because it may have some impact on the decisions that relate to exports.
Our policy in relation to the Quigley Report must be approached in joint consultation with all the interests involved. It would probably be wrong for the Government to indicate a strategy before the consultations are meaningfully completed. I am sure that the hon. Member for Abingdon and others who have brought this matter to the notice of the House will agree that consultations should be concluded before decisions and announcements are made about strategy.
A great deal has been said about Harland and Wolff and its future prospects. There are many problems at Harland and Wolff of which we are already aware. I shall deal with one or two matters that have been brought to my notice. I have been asked about future prospects and manning at the company. As this is primarily a financial debate I shall start by referring to the £60 million that was committed to the company in August 1975 when the company was taken into public ownership. I am glad to be able to report to the House that drawings from that sum are more or less, allowing for weekly and monthly swings, on the course predicted.
The House will recollect that the money was intended to enable the company to complete its order book in late

1978 or early 1979. Manning levels and future prospects clearly depend upon the size and scope of new orders, while new orders depend upon the ability of the company. Management and unions both have a part to play in convincing potential buyers that the company is competitive in terms of price and delivery.
I need not remind the House of the serious state of the world's shipbuilding industry in the face of excess capacity chasing too few orders. Indeed, we have heard quite a lot about these subjects in recent days. However, I shall not be breaching commercial confidence if I say that Harland and Wolff is vigorously following up a number of leads, any one of which would have a major impact on its order book if current inquiries led to firm orders. I would rather not say any more about that at the moment.

Mr. J. Enoch Powell: I understand the hon. Gentleman to say just now that financial experience was proceeding much as was anticipated a year or 18 months ago. How is that reconciled with his statement in introducing the order that one of the major items was due to the bringing forward in time of £11 million of the total expenditure anticipated? I am sure that there is a reconciliation. I wonder whether the hon. Gentleman can clear my mind about it.

Mr. Dunn: I cannot give exact details about why this has been brought forward from next year's Estimates to this year's other than to make the general observation that in order to continue with the intense consultations which are taking place between the interested parties, the Government and other industries which serve Harland and Wolff, it was felt necessary to provide sufficient funds to implement any decisions which might be made to further the productivity which would lead to firm orders being achieved. It is in that regard that money has been brought forward, and it is brought forward in the sense that there has been a shift in the expenditure to date and we are trying to redivert resources into Harland and Wolff which may well lie fallow if we do not take the opportunity presented to us. But I shall write to the right hon. Gentleman giving him exact details on this matter.
In all the discussions which are taking place, I am glad to report that there has


been an encouraging movement over the past two years towards improved productivity. There is a commonly used unit of measurement for productivity in the shipbuilding industry, namely, the overall number of man-hours expended on steelwork activities. This has shown remarkable results in Harland and Wolff.
Agreement was also reached in June on a proposed scheme of worker participation and, since then, the management and trade unions have been engaged individually and jointly in finalising arrangements for the scheme's introduction. Attention has been focused particularly on the arrangements for establishing the proposed trade union resource centre on the development of participatory structures at the various sub-board levels and on a procedure for the election of worker directors. Substantial progress has been made on the first two of these. However, there is some evidence of difficulty amongst the trade unions in reaching agreement on the election procedures, and the Department of Manpower Services is proposing to meet the unions shortly to establish precisely where matters stand. I am sure that all right hon. and hon. Members will be pleased that this progress has been achieved.
The next matter of substance to be raised concerned education policy. Here again, there is a wide range of views, and they were expressed in the debate by the hon. Members for Abingdon and Down, North and the right hon. Member for Belfast, East. In July 1976, the Department of Education published its consultative document on the reorganisation of secondary education in Northern Ireland. The document included a feasibility study which was carried out by the Chief Inspector of the Department of Education into the practicability of introducing a comprehensive system of secondary education using existing school buildings with only the minimum of alteration of new buildings.
The Government have invited comments on the consultative document, but I must make it clear that no decisions will be taken on the question of comprehensive education until these comments are received and considered. The original deadline for receipt of comments was January, but following further representations this has been extended to

Easter, 1977. I emphasise that no decisions have been taken.
The consultative document pointed out that the Government were committed nationally to comprehensive reorganisation and were fundamentally convinced of the merits of the comprehensive principle. But it was also pointed out that in governing Northern Ireland the Government would wish to take full account of a number of special characteristics. That is why decisions are being deferred until we have the benefit of comments and advice from a wide spectrum of opinion.

Mr. McCusker: While accepting that the Government do want to receive all sorts of representations and suggestions, I urge the Minister to accept that Christmas has intervened and that the people of Northern Ireland are rather pre-occupied with staying alive and in employment. The time for discussions has been weeks rather than months. As this matter is fundamental to the future of educational policy in the Province, would the Minister ask the Secretary of State to consider pushing the deadline back? We are trying to stimulate discussion but we are running past the deadline.

Mr. Dunn: I shall convey the hon. Member's suggestions to the Minister of State, who is responsible for education, but in all honesty the criteria he has put forward for further delay could be applied to almost every subject at the end of the day. The hon. Member would not wish to delay every subject because of these criteria. I do appreciate and sympathise with the problem, but the Government must try to get results as soon as possible. A lot of detailed analysis and further consultations with the education authorities and teachers' organisations will be necessary. This should not be delayed unnecessarily.

Mr. John Biggs-Davison: But are not the Government in favour of a devolved system of government in Northern Ireland? Would not education be a devolved matter?

Mr. Dunn: As I have clearly indicated in the statements I have made, we shall bear in mind the very special needs of the Province. These needs include references to a devolved government, and the particular characteristics which would


have to be taken into account before any decisions were made. I cannot go any further in answering questions. We are committed to reorganisation nationally. We have not said that we are absolutely committed to do exactly the same in Northern Ireland. That is the purpose of the consultative paper. If, after considering the comments received, the Government take the decision that these secondary schools should go comprehensive, it is expected that that decision in principle would be set out in a White Paper. This would mean further consultation and would provide another opportunity for public discussion before legislation was introduced.
The implementation of such a policy obviously would be spread over a period of years. Therefore it is inevitable that, irrespective of whatever decision is taken on the principle of comprehensive education, we shall continue to deal with the problems of selection at 11, at least for some years to come. The Minister of State will establish a working party which will consider the method of selection at 11. The Government are aware of the dissatisfaction caused by the operation of the present system.
Reference has been made to the mistake in the second paper issued to children, and the hon. Member for Down, North made some comments about it. This has exercised the minds of all concerned, and it was thought to be in the interests of the children that the question should be withdrawn and that the marking of the paper should take account of the ability range shown in the answers to the other questions on the paper. I am not an expert educationist, and I would not wish to cross swords with the hon. Member on the matter. It has exercised the minds of those concerned. Decisions have been taken in the interests of the children. I believe that education is primarily for children.

Mr. Kilfedder: The children were not responsible for the fault in the test. Will the hon. Gentleman reconsider my remarks? Will he convey those remarks to his right hon. Friend, bearing in mind that a child trying to understand a question which is incomprehensible will have wasted a lot of time on that question and will have been demoralised by having failed to understand it? Surely that will

affect the child's performance in the rest of the paper. An adjustment in the marking of the paper is not the answer.

Mr. Dunn: I will convey the hon. Gentleman's submissions to my colleagues. I shall bear in mind the hon. Gentleman's comment about the demoralising effect of failing to understand. If what he said was completely true many hon. Members—including myself—would be demoralised over some of the subjects which are brought before us here.
I come next to the question of energy costs and the delay in publishing the Shepherd Report. The Secretary of State is very much aware of the many problems created by high energy costs, and I understand that the report will be published as soon as possible in 1977. I cannot at present account for the delay. However, I shall bear the point in mind and if it will serve a useful purpose to do so I shall write to the hon. Member for Abingdon with an explanation.
The hon. Member also brought to my attention the question of Strathearn Audio. The Treasury has agreed to the proposals which have been made, and a public announcement may be made next week. That announcement will deal with continuation of employment of the existing workforce. The discussions about the future of the company are complex and involved, and I am not yet in a position to make a full statement. It will be made by my right hon. Friend as soon as possible.

Mr. Neave: Will that statement be made in the House?

Mr. Dunn: If the opportunity were to present itself, my right hon. Friend would prefer to make the statement in the House. However, the distance between Belfast and this House, combined with the necessity of being in the Province, presents difficulties. I shall, nevertheless, convey to my right hon. Friend what the hon. Gentleman said.
The green pound is a subject of great complexity. Many people have misunderstood the original purpose of the scheme. I am grateful to the hon. Member for Londonderry (Mr. Ross) for bringing that so starkly back into notice. The hon. Member for Abingdon and the right hon. Member for Belfast, East have also contributed to that.
The meat industry scheme was introduced on 25th October after the first devaluation of the Irish green pound on 11th October. It was initially for a period of four weeks. This was extended on 22nd November for a further 13 weeks to 19th February. Continuation of the scheme will depend upon the review nearer the end of the present scheme. The purpose of the scheme is understood by all those who are engaged in agriculture in Northern Ireland and by the meat processors. It would be wrong of me to go into the background detail of the scheme or to explain any of the criteria, other than to reaffirm that approximately 3,000 jobs are at risk in the meat processing industry and many more, which we cannot quantify at the moment, in ancillary industries.
The cost from the inception of the scheme—from 25th October 1976 to 19th February 1977—is estimated to be about £4 million for cattle and about £600,000 for pigs. It is expected that funds to finance the scheme in the current financial year will be found from the shortfall in Northern Ireland programmes. I assure the hon. Member for Londonderry (Mr. Ross) that there has been no cutback in the estimates for Northern Ireland. We have attempted to use up the shortfall in advance in order to achieve greater flexibility and better use of the resources available to us.

Rev. Ian Paisley: Surely it is a fact that the Common Market is subsidising us by £1·5 million a day. Why is not part of that money being used for something which stems from a Common Market decision? I assure the Minister that we are not against taking subsidies from the Common Market. I would take all that I could get out of the Common Market. I should like to bankrupt it and put it out of business altogether.

Mr. Dunn: We do take the money. Like the hon. Gentleman, I am pleased that we have the opportunity of taking it. This money, which is deposited in the contingency funds, is redistributed throughout the United Kingdom in many ways, and Northern Ireland gets its fair share. I appreciate the matters to which the hon. Gentleman is alluding. I assure him that those matters are being pursued with vigour. If I were to repeat chapter and verse what is being done, the cause for which he has indicated some concern

—I hope that he appreciates that it is my concern, too—might be jeopardised.
I should like now to deal with the question of shortfall which was brought to my attention by the hon. Member for Londonderry. I assure him that there has been no cutback in expenditure in Northern Ireland. We have used the shortfall as best we can. The hon. Gentleman criticised us for doing that. On the one hand, we are criticised about shortfall. On the other hand, if we try to avert shortfall in one sector by utilising resources in another, criticism is also directed towards us. With respect, the hon. Gentleman cannot have it both ways. Perhaps at some time he will make up his mind which way he wants it and will advocate how it should be used.
It has been suggested that smuggling can be stopped by one resource or another. One suggestion was that the border could be closed. Indeed, I have heard that in the past the border has been effectively closed. However, I doubt whether it is possible to close the border to stop all forms of smuggling. I venture to suggest that, if we closed the land border, the initiative of man being what it is, small sea vessels would be procured and we should then have to cover a long coastline. This practice, which has been going on for many years—

It being half-past Twelve o'clock MR. DEPUTY SPEAKER put the Question pursuant to Order this day.

Question agreed to.

Resolved.
That the appropriation (No. 3) (Northern Ireland) Order 1976, a draft of which was laid before this House on 8th November 1976 in the last Session of Parliament, be approved.

Orders of the Day — NORTHERN IRELAND (SUPPLEMENTARY BENEFITS)

12.30 a.m.

The Under-Secretary of State for Northern Ireland (Mr. James A. Dunn): I beg to move,
That the Supplementary Benefits (Amendment) (Northern Ireland) Order 1976 (S.I., 1976, No. 1781), a copy of which was laid before this House on 4th November 1976 in the last Session of Parliament, be approved.
By reason of urgency, the order has been made without a draft having been


approved by a resolution of each House of Parliament. The order came into effect on 15th November 1976, and if it is to continue to have effect it must now be approved. The purpose of the order is to maintain the principle of parity with Great Britain in the cash social services. It has two main objectives.
The Supplementary Benefit (Amendment) Act 1976 amends the Supplementary Benefit Act 1966 to provide that a single parent receiving supplementary benefit may earn up to £6 a week before that benefit is reduced. Before this change became effective, lone parents, like most other people receiving supplementary benefit were permitted to earn up to £4 a week without any reduction in their benefit. Those who are required to register for work were able to have £2 of earnings disregarded. The first part of the order makes similar provision for Northern Ireland by amending the Supplementary Benefits Etc. Act (Northern Ireland) 1966 to give the more generous earnings disregard
About 100 single parent families receiving supplementary benefit in Northern Ireland have earnings of more than £4 per week and have been helped by the new provisions. The extra cost in a full year is expected to be about £11,000.
Some further additional expenditure will also arise because there are single parents whose income, including part-time earnings, put them above the supplementary benefit level before this increase became effective. These persons may be able to claim up to £2 of benefit on account of the higher disregard. It is hoped that the increase in the disregard will make it worth while for many more single parents to undertake part-time work. This will not cost any more in benefit payments.
I now come to the second part of the order, which provides for the discontinuance of certain small disregards attached to the children's portion of widows' pensions and allowances. Similar provision for Great Britain is made in the Supplementary Benefit (Amendment) Act 1976. The pensions and allowances involved are national insurance widowed mother's allowance, industrial death benefit and war widows' and similar pensions. These disregards were introduced in 1964 in the

national assistance era when an increase was made in the children's allowances attached to widows' pensions at a time when no other benefit changes were taking place.
Although the disregards have continued since then, they have never been increased but on decimalisation became 38p and 28p. It is considered that, in conjunction with the increases provided by the first part of the order, this is an opportune time to discontinue these disregards for new claimants. The order provides, however, that they remain for those who have what are referred to as "preserved 1976 rights"—that is to say, claimants who now have the benefit of the disregards will continue to benefit from them for as long as they continue to receive supplementary benefit in conjunction with the war widow's benefit or other benefit involved. If, as sometimes happens, the widow enters hospital and payment of supplementary benefit ceases, that gap in entitlement, no matter what its duration, will not affect her preserved rights. Other gaps in entitlement due, for example, to spells of employment will not affect her preserved rights if they are no longer than three months.
The discontinuance of the disregards will eventually result in a saving of about £24,000, but this will not be achieved immediately since the existence of preserved rights will mean that it could take many years for the disregards to work fully out of the system.
I trust that this brief explanation has given the House an adequate outline of the substance of the order. As I mentioned at the outset, it maintains the principle of parity between cash social services in Northern Ireland and those in Great Britain. I commend the order to the House.

12.35 a.m.

Mr. Robert J. Bradford: We welcome this order, which brings Northern Ireland legislation into line with existing United Kingdom legislation, thereby affording to one-parent families in Northern Ireland the benefit of an increase in the amount of earnings to be disregarded in calculating entitlement to supplementary benefit.
We welcome the order because it implements yet another of the excellent recommendations in the report on the


plight of one-parent families, known as the Finer Report, which recommended that there should be an increase in the disregard figure. We are delighted that since the report was published there have now been two increases. The order assists this needy section of the community in Northern Ireland and Great Britain.

Question put and agreed to.

Resolved,
That the Supplementary Benefits (Amendment) (Northern Ireland) Order 1976 (S.I., 1976, No. 1781), a copy of which was laid before this House on 4th November 1976 in that last Session of Parliament, be approved.

Orders of the Day — NORTHERN IRELAND (NOXIOUS WEEDS)

12.38 a.m.

The Under-Secretary of State for Northern Ireland (Mr. James A. Dunn): I beg to move,
That the Noxious Weeds (Northern Ireland) Order 1976, a draft of which was laid before this House on 12th November 1976 in the last Session of Parliament, be approved.
This order updates the various enactments relating to the control of noxious weeds in Northern Ireland, to take account of changes which have occurred since the original enactment of 1909. It also updates the penalties.
Thistle, dock and ragwort have been listed as noxious weeds since 1909, and heavy infestations cause considerable financial loss. The use of modern herbicides and good grazing management provide effective control, but the seeds of these weeds can be windborne. Such weeds on the lands of one neglectful occupier can result in the spread of the infestation over a wide area of adjoining land.
However, a matter which is causing even greater concern in Northern Ireland is the spread of wild oats. It was first detected in Northern Ireland in 1966, when a number of light infestations were observed in barley crops in four of the six counties. Subsequent small-scale surveys and reports by field staff indicated that the number of infestations and their intensity was increasing rapidly, and in 1971 wild oat was scheduled as a noxious weed.
By 1975, a detailed survey showed that 25 per cent. of the barley crops throughout the Province were infested, although

most of the infestations were classified as "light"—or, in other words there were fewer than 500 wild oat plants per acre. Individual plants are capable of producing about 50 viable seeds per year, so that a light infestation can rapidly become a heavy infestation if immediate steps are not taken to destroy the weed when it is observed. Where there is a serious infestation it may become necessary to prohibit the growing of cereals on the land for a number of years. The order provides the power to do so.
Right hon. and hon. Members will realise the scale of the problem when I tell them that 80 per cent. of the total cereals used in animal feed in Northern Ireland have to be imported. Any increase in domestic production is therefore in the national interest, but the wild oat, left unchecked, could become a limiting factor in the economic expansion of the domestic cereal area. An intensive publicity and advisory campaign has been under way in Northern Ireland since the wild oat problem first came to notice.
At the moment infestations are, in the main, being contained, but this is not enough; they need to be drastically reduced. Therefore, the order provides authorised officers—by which I mean officers of the Department of Agriculture for Northern Ireland who have been specifically authorised in writing—with the means and the powers to detect outbreaks and to order or carry out the destruction of noxious weeds. The order also provides powers to prevent the importation of noxious weeds and substantially increases the penalties for offences under the order by raising the maximum penalty for a first offence from £20 to £100 and for subsequent offences from £50 to £200.
I should mention that Section 2(2) of the Noxious Weeds Act (Northern Ireland) 1929 conferred power on members of the Royal Ulster Constabulary to enforce the legislation. This power has not been exercised since the mid-1960s, nor is it likely to be exercised in view of the pressures on the police in Northern Ireland, and it has accordingly been omitted.

12.43 a.m.

Mr. John Biggs-Davison: Northern Ireland has an excellent


record for animal and plant health, and this order should help to maintain that record.
I would like to clear up one point. I understand that the order will not involve any increase in staff or expenditure in the public sector. On the other hand, the Minister spoke of officers and a publicity campaign. Do I understand that these will not involve any additional expenditure in the public sector?
As for the point about the release of the Royal Ulster Constabulary from duties in connection with this legislation, we welcome it because the police have far more noxious weeds to contend with at this time.

12.44 a.m.

Mr. Wm. Ross: I welcome this consolidation measure, and I think that most farmers in Northern Ireland will also do so. The need to suppress weeds, both human and vegetable, in Northern Ireland has long been recognised and is widely supported by the farming community. In fact, I think that the farming community of Northern Ireland, like farmers everywhere else, recognise that one year's seeding means seven years' weeding. Even with the new herbicides that we have the weeds are still a problem, and prevention is always better than cure.
There is one small matter about which I should like to ask, if the Minister can answer me at short notice. In the original Act reference was made to a weed caled the oxeye daisy, which seems no longer to exist. When I was a small boy there seemed to be many of these daisies growing in the fields, but I have not seen any growing for years. They seem to have disappeared from the scene. Although they were rather large, they made excellent daisy chains for children.
On a more serious note, does the prohibition of the import of weeds mentioned in Article 4 include weed seeds? The horrifying figures given by the Minister of the prevalence of wild oats must arise from that source and no other. Not many years ago the wild oat was practically unknown in Northern Ireland. Now it is rapidly becoming a major cause for concern throughout the grain-growing areas.
There is no mention of police officers in the explanatory document, although they are mentioned in the explanatory note at the end of the order. Why is there no mention of police officers in the explanatory document? I regret that members of the RUC are no longer travelling around the countryside, talking to people, visiting their homes and finding out who lives where and who is doing what. In that way the relationship between the police and the community at large was improved.
One of the greatest problems in Northern Ireland—and in most civilised countries in the Western world—is that the police are no longer moving about among the general population as much as they once did. Policemen have virtually disappeared from the country roads. Had the police still been around in the country areas they would have had more contact and been building up a much better relationship with the people, and some of the problems from which we suffer might have been alleviated or avoided altogether.
Officials of the Department of Agriculture over the years have built up an excellent relationship with the farming community. They are almost universally welcomed in the countryside. If we make law enforcement officers out of officers of an advisory service which has always been accepted as such, we shall impair the excellent relationship which has been of such greatet benefit to the agricultural community. The police should enforce the law in Northern Ireland, as elsewhere, and so help maintain the good relations, which were practically family-like, between Department of Agriculture officials and the policemen concerned.

12.47 a.m.

Rev. Ian Paisley: I support my hon. Friend the Member for Londonderry (Mr. Ross). I am suspicious about the police no longer being the authority in this matter. Is it because the police cannot go into certain areas of Northern Ireland that the Department is taking the easy way out and changing the law so that the person responsible shall be an authorised officer of the Department of Agriculture?
Too often have people been told of changes only to find when they scraped beneath the surface that the changes were


caused by the law and order situation. If the police are unable to go into all areas—as we know they are—it would be far better to let the people know that. If the police are unable to go into all areas, will an authorised officer of the Department of Agriculture be able to do so? Who will be the enforcement officers? Will they be authorised servants of a Government Department, or will the police have their proper rôle?
The order makes a substantial change of which we are not in favour. We do not echo the words of the official Opposition spokesman who welcomed the order. We do not welcome it. An important principle is involved. This is an easy way of covering over something that is of great importance.
We do not minimise the importance of the order. The facts given by the hon. Gentleman are staggering. I do not think that we realise how serious the problem is. We believe that steps must be taken to deal with it. We believe in the principle of the order, but we do not like that part of it which changes the law in the Acts now to be repealed. We would like an explanation of the matter and of why the change should take place.
I echo what my hon. Friend the Member for Londonderry said about the relationship between officials of the Department of Agriculture and the farming community. Anything that would bring about an erosion of that relationship, that would set the agricultural officers at variance with the farmers, would not be helpful to Northern Ireland. Northern Ireland has a very good agricultural record. Agriculture is our main industry. Its farmers need all the support and praise that they can get, whether it comes through Common Market subsidy or not. But we take the view that a dangerous precedent is set by the order. This is an important and substantial change that the Government are proposing.

12.52 a.m.

Mr. Dunn: I assure the hon. Member for Antrim, North (Rev. Ian Paisley) that what he has suggested might be the case is not the intention of the order. Taking into account all

the technical factors involved and the experience required to be able to recognise and advise on these noxious weeds, together with the necessary specialised knowledge of herbicides, it would be an unfair burden to put on the police. But there is nothing to stop the police from continuing to make their contacts in the areas they have regularly visited. Indeed, it might relieve them of the burdensome task of trying to identify noxious weeds. No doubt that has caused them problems from time to time.
In the sense used by the hon. Member for Londonderry (Mr. Ross) and the hon. Member for Antrim, North, the relationship between the advisory service and the farmers can continue. The attack upon the noxious weed will be on the basis of advice in the first instance. It is only when someone refuses to take action to remove the noxious weed and thereby causes the hazard to which I alluded in opening the debate that further action will be taken, and it will be within the control of the Department of Agriculture. There will be no precipitate action against anyone who would be involved through ignorance or who perhaps had some difficulty. The Department will show understanding.

Mr. J. Enoch Powell: Will the hon. Gentleman address himself to the question of whether other, parallel matters involved in agriculture—other pest regulations—are still subject to be dealt with by the police or whether the order is part of a general policy which is part way through the whole field? The control of weeds is not the only case of its kind where, in default of the following of advice, proceedings have to be taken and summonses have to be issued.
Summonses have to be issued. It is certainly my impression and, as far as I am able to judge, that of my hon. Friends that in areas cognate to this the police are still responsible for enforcement. I do not suggest that the hon. Gentleman should deal with the matter tonight, but our minds would be relieved if he would indicate that he and his Department are willing to take a broader look at the rôle of the police both in this matter and in agriculture generally.


If the Minister would say that tonight, we could follow up this matter on a broader basis subsequently.

Mr. Dunn: I can give the right hon. Member the assurance he seeks, and I shall write to him about the complex question he has raised. I assure him that this is not an attempt by the Department to thwart the useful work carried out in support of the Department of Agriculture by the Royal Ulster Constabulary.
The House will recall that in many instances animal health regulations are enforced by authorised officers of the Department of Agriculture in Northern Ireland. Enforcement powers have for a long time been vested in departmental officers. It is not a new departure. The only departure in this case is that, for the first time, the powers of the police have changed. I thought I gave an explanation when I indicated that the time of the constabulary ought not to be spent in an area which would cause it grave difficulty because of the specialised knowledge that its members would have to master in relation to the control and use of herbicides.

Mr. Wm. Ross: The Minister has cleared up a point which has been troubling many people in Northern Ireland. When next summer rolls round, will he send an official down the corridor to the Minister responsible for roads to see about the cutting of weeds alongside the roads in Northern Ireland?

Mr. Dunn: Wherever a noxious weed may grow, if it is brought to the notice of the Department we will take action. I shall go no further on that point—or on the long walk that it has been suggested I should take.
The hon. Member for Londonderry asked whether Article 4 of the order would prohibit the importation of seeds. It will
restrict the importation or removal into Northern Ireland, or the selling or the offering or exposing for sale or the purchasing, of plants or parts of plants which are noxious weeds.
The answer to the hon. Member for Epping Forest (Mr. Biggs-Davison) is that the publicity campaign is already undertaken by the advisory service and will be contained within the normal cost of that service.

Rev. Ian Paisley: Why is it not possible for the expert to identify the weed and for the police to retain their rôle as enforcement officers?

Mr. Dunn: That would impose an unfair burden on the police. I also have responsibility for the administration of the police, and from time to time the calls upon this service are more than it can undertake. There are more serious sectors for them to deal with than prosecutions in relation to noxious weeds. I do not wish to be discourteous to anyone, but if I had to choose priorities for the police I would not put first their responsibility for prosecutions over noxious weeds.

Question put and agreed to.

Resolved,
That the Noxious Weeds (Northern Ireland) Order 1976, a draft of which was laid before this House on 12th November 1976 in the last Session of Parliament, be approved.

Orders of the Day — NORTHERN IRELAND (INDUSTRIAL RELATIONS)

1.0 a.m.

The Minister of State, Northern Ireland Office (Mr. J. D. Concannon): I beg to move,
That the Industrial Relations (No. 2) (Northern Ireland) Order 1976, a draft of which was laid before this House on 9th November 1976 in the last Session of Parliament, be approved.
All the usual consultations have taken place or have been offered on the order.
Hon. Members will recall that in the last Session the House approved the first Industrial Relations Order. That order implemented those recommendations of the Review Body on Industrial Relations in Northern Ireland which required legislation and also began the process of bringing the law of Northern Ireland relating to industrial relations into line with that in Great Britain. In proposing the approval of that order, my predecessor declared that it was Government policy that workers in Northern Ireland should enjoy the rights introduced by the Trade Union and Labour Relations Acts 1974 and 1976 and the Employment Protection Act 1975 no less than their counterparts in Great Britain. The further implementation of that policy is the purpose of the draft order.
It will be in the spirit of that policy and, as I understand it, for the convenience of the House if I conclude my speech now.

1.2 a.m.

Mr. John Biggs-Davison: Parity is a popular phrase in these debates and there is general agreement in the House that there should be as much parity as possible in policy and administration between Great Britain and Northern Ireland.
The order is concerned with industrial relations. I sometimes think that if there were more parity in Great Britain with the usually cordial industrial relations for which Northern Ireland is celebrated it would be good for the whole Kingdom and its strugging economy.
The Northern Ireland strike rate is still half that of Great Briain, though there has been a deterioration lately and we must not imagine that industrial relations in the Province are perfect. The Labour Relations Agency has already been intervening in a company's affairs.
The review body with which this legislation originated recommended that
Any changes introduced into the arrangements for the conduct of industrial relations in Northern Ireland should be specifically designed for, and thus subject to, local needs and conditions.
Many firms operating in Northern Ireland are based in Great Britain, and, quite apart from the general principle of parity, there is advantage for their managements in the parity of machinery and procedures laid down in the order.
On the other hand, the order imposes on Northern Ireland the provisions of the Employment Protection Act 1975. When that measure was being considered, the Opposition objected to the heavy burden imposed on British industry, which, in a sense, is fighting for survival. Our objections seem to apply even more forcefully across the sea.
The order is of the magnitude of the Act in Great Britain, yet we are passing it in a few minutes. We cannot amend it, the time allowed for debate is derisory, and we have to consider it late at night.
I shall not rehearse the arguments put forward by the Opposition on the last order, except to refer to what my hon. Friend the Member for Abingdon (Mr. Neave) has described as

a dose of Socialist medicine for Northern Ireland.
My hon. Friend warned the Province of what was coming to it.
It has not been clear so far what importance the Government attach to the Quigley Report. We have had no move to have the matter debated in the House or even in the Northern Ireland Committee. Part 11 of the Quigley Report is devoted to industrial costs, and the handicap of energy and transport costs being higher in Northern Ireland than those obtaining elsewhere in the United Kingdom runs as a theme through the Review Body's report on an economic and industrial strategy for Northern Ireland.
Is it not surprising that a Labour Government are not more wary of imposing conditions that may result in employers being compelled to lay men and women off, or put them on short-time working, and might that not discourage potential investors? That does not seem to me to be employment protection, but to be more a matter of unemployment creation.
The Minister of State who was at the Northern Ireland Office and who has since been translated to the Department of Health and Social Security introduced the previous order. In so doing he admitted that
it will lead to increased costs. I cannot indicate the extent of the costs but they will be of an order that can be met.
How did the hon. Gentleman know? Furthermore, does the present Minister of State, Northern Ireland Office agree with his hon. Friend? I fear that in some cases the costs will be met by short-time working, unemployment and possibly even by bankruptcy.
I turn to the provisions in Article 3(2)(a) in relation to bargaining and wages and conditions of work in comparison with other employees. That hardly squares with the aim expressed by the former Minister of State, who said in the same debate on 10th June, at col. 1811:
the survival of Northern Ireland's economy depends on the success of the British Government's counter-inflation policy and of the action on wage costs".—[Official Report, 10th June 1976; Vol. 912, c. 1847, 1811.]
That is the policy as it applies to Northern Ireland.
I seek clarification of one word in the article—namely, the word "district"


Does "district" refer to the whole of Northern Ireland or to areas within it? It would surely be disastrous if levels of comparison were more widely extended. Our aim should be a high-wage, high-productivity economy for Northern Ireland, but that is not immediately within sight. If the Government further narrow the gap in wage levels—a gap which has already narrowed considerebly during the last decade—Ulstermen and women may stand to lose their jobs, thousands may see their prospects of employment fade and the industrial revival of Northern Ireland will be retarded.
Industrial relations in Northern Ireland have hitherto been an example to the United Kingdom. To improve further on that proud record should be the common purpose of this House. The courage of Ulster workers, whether in management or on the shop floor, whether in the public or private sector, who toil through terror and destruction, deserve better than the legislative importation from the mainland of some of the ingredients of industrial strife.
It seems to me that the order erects an unbalanced framework of industrial relations. It is the sort of legislation which is part of the tribute paid by the party in power to its paymasters. Therefore, it is the Opposition's duty to record that we fear that the order may place obstacles in the way of the attainment of the object which it is intended to secure.

1.9 a.m.

Mr. McCusker: I am glad that the hon. Member for Epping Forest (Mr. Biggs-Davison) reminded us that the first Industrial Relations Order relating to Northern Ireland was a dose of Socialism for the Province. I presume he was implying that this was a second dose of Socialism for Northern Ireland, but I caution him when in the same breath he appears to recommend the Quigley Report and its recommendations. If the two orders are doses of Socialism, the Quigley Report could be considered to be a course of treatment. It might be acceptable to me and to some of my hon. Friends, but I should not have thought that it would be as acceptable to the hon. Member and to some of his Friends. We should be careful not

to make comments such as that with regard to an order of this sort and almost recommend what is contained in the Quigley Report.

Mr. Biggs-Davison: I think that the hon. Gentleman has misunderstood me. I did not express any view at all on the Quigley Report. I merely referred to it. I did not express a view either for it or against it.

Mr. McCusker: That might well be the case, but the frequency with which it was referred to in the earlier debate this evening would certainly have been directed towards getting the Government to take some cognisance of it and to bring it forward for debate, and that would imply implementing some of its recommendations. Those recommendations could not by any standard be considered as other than strong doses of Socialism. Therefore, we should be careful in regard to this matter.
I agree with the hon. Gentleman's reference to the way that the legislation has been handled. That is a point that my hon. Friends and I have made again and again. It is a pity that workers in Northern Ireland have been deprived for between 12 and 18 months of rights and privileges which have been accorded to their fellow workers in the rest of the United Kingdom simply because of the system of legislating.
My hon. Friend the Member for Antrim, North (Rev. Ian Paisley) made this very clear when he said:
I am sorry that the Government do not see their way clear to stick rigidly to the principle of uniformity for the whole of the United Kingdom. Many of us have very little objection to uniformity if the Minister could guarantee us step-by-step legislation.
If Northern Ireland had been included within the ambit of the two measures to which reference was made, we, the Members from Northern Ireland, could have made a much more positive contribution to the debate. It would have brought workers in Northern Ireland much more into line with the workers in the United Kingdom.
I welcome the order to the extent that it gives to the people in Northern Ireland the same rights and privileges as those of our fellow citizens and brings us back into the main stream of thinking in the United Kingdom.
The hon. Member for Belfast, West (Mr. Fitt)—I am sorry that he is not with us, because he normally makes a positive contribution in these matters—said in that same debate that he welcomed
every comma, sentence and clause in the Bill".—[Official Report, 10th June 1976; Vol. 912, c. 1834, 1829.]
He said that he was looking forward to what he would say about this order.
I do not want to go into the detail of the order but wish simply to restate my objection to the one section. I am now doing this for the fourth time. If a young married woman who is working decides to have a family, that is a responsibility which she and her husband accept, and I do not think it is any part of an employer's duty to compensate, reward or assist her in that respect. It may well be that the Government believe that married women require compensation if they decide to have children and that we should thereby introduce some system of payment into our State system of benefits.
I do not think it is any responsibility of an employer to compensate or reward a young married woman for having a child. I do not think it is any part of an employer's responsibility to promise her security of employment if she is prepared to come back to work six months after she has had the child, and to leave the child to the tender mercies of a child-minder. We know only too well the problems created in Northern Ireland by latch-key children and by children who do not have the benefit of the protection offered to them by the mother being present in the home.
I objected to this portion of the legislation during the debate on the Employment Protection Act and also when we had the first order relating to Northern Ireland. I object to it again now. It is wrong in principle and I do not think we should have it. Apart from that, I am glad that we have this order and that it completes the package of industrial relations legislation for Northern Ireland.
Article 16 of the No. 1 order gives the Minister power to transfer the conciliatory role from the Manpower Services Commission to the Agency. The Minister's predecessor said that he would have to make a decision on this quite soon. I argued at the time that it was useful for the Government to have a foot

in both camps and to have the high standing in both camps which they have at the moment. To remove that role from the Manpower Services Commission would deprive it of that contact. I shall be interested to know whether the Minister can tell us whether any decision has been made in that respect.

Rev. Ian Paisley: I reinforce what has been said by my hon. Friend the Member for Armagh (Mr. McCusker): We should prefer legislation of this nature to be taken properly with legislation affecting the whole of the United Kingdom. We are in the position that we cannot amend. We cannot do anything to help this measure. We can only pass comments on it before it passes into law.
The hon. Member for Epping Forest (Mr. Biggs-Davison) must know that when a Socialist Government were in power in the United Kingdom Northern Ireland had to accept the legislation that they introduced. The so-called Conservative Government in Stormont rubberstamped it. They passed every letter of it, every comma of it, every semicolon of it and every dash of it. If the electors of the United Kingdom elect a Labour Government and that Government, by their authority in the House, pass legislation, all sections of the community, irrespective of whether they are Conservative, have to accept the laws of Parliament.
I welcome everything that safeguards the right of the employee. I also welcome all legislation that helps the employer and brings forward a good relationship between employee and employer. Northern Ireland has a good record in this area and I do not see anything in this measure that will militate against it. We may have our own philosophies—for example, the hon. Member for Epping Forest will have far stronger Tory philosophies than mine—but our concern is that this is not the way in which legislation should be brought forward.
One matter to which I must refer is to be found in Article 60, on page 39 of the order, where it is said:
The Head of the Department shall be the appropriate Northern Irish authority".
To my recollection, I have never before seen that reference in any legislation. It


has always been "Northern Ireland Authority". If the Minister turns to the next page he will find that it is not the Northern Irish Maternity Pay Fund or the Northern Irish Redundancy Fund, those two funds being prefixed "Northern Ireland".
I shall not give the Minister a lecture on the way that "Northern Irish" is used, but it is used by those who believe in a united Ireland and talk about North Irish people. During the past week we have heard talk about Irish people, never about the people of Northern Ireland or the Ulster people. We believe that we are Britishers and part of the United Kingdom, and we are here to maintain that link with the United Kingdom.
I hope that the Minister will take up this matter. I know that he cannot do anything about it, but I am highlighting it in the expectation that we shall have some explanation. Please let us have "Northern Ireland authority". Let us not allow Republican phraseology to creep into these measures. I feel sorely tempted to speak at length on this matter but I shall forbear from doing so. I know that the Minister was in my constituency today, and I hope that his visit will be helpful to the workers in the constituency.

1.20 a.m.

Mr. Concannon: On that last matter, obviously I give full marks to the hon. Member for Antrim, North (Rev. Ian Paisley). He has read through the order and has picked out the phrase "Northern Irish", instead of "Northern Ireland". All I can say to the hon. Gentleman is "Well done". I shall write to him explaining why that phrase is included. When making inquiries of this kind, I usually find that there is some history behind such phrases. But I shall write to the hon. Gentleman with the explanation.
There is always great dissatisfaction in introducing an order of this kind. I have stressed it myself on many occasions. But, within the confines in which we work, I have been careful to make sure that all the consultation processes possible have been gone through, and I have given opportunities for other people to come and talk to me. We have been able to explain and to iron out

some of the problems, and in general terms the order is acceptable and welcome to the work force in Northern Ireland.
Article 16, of course, was promised by my predecessor, and I had to take it on board. Here again, without wishing to present a fait accompli to any side, I am in consultations with both sides about it. I have met one side. I have now to meet the other side to discuss how a system can be worked out between the two sides embracing what they require and what is required within the Department. If we can come to a mutual arrangement, I think that that is the best way to proceed.
I agree with the hon. Member for Epping Forest (Mr. Biggs-Davison) that industrial relations in Northern Ireland are good. It is one of my best selling points when I am trying to counter some of the bad publicity that we have in Northern Ireland as I travel round. It is always surprising to industrialists to be told how good industrial relations are in the Province, in terms of the number of shifts lost per thousand workers and so on. Compared with the United Kingdom figure, in Northern Ireland it is usually half.
But I think that the hon. Member for Epping Forest has a bit of a nerve. I like to think that the reason for the good industrial relations in Northern Ireland is not concerned with the dose of Socialism that it has at present or is contemplating having through this order. It is that it missed the dose of Conservatism in 1971. Northern Ireland counts its blessings that it did not experience that poisoning of the industrial relations atmosphere. It missed out, and it has been thankful ever since. This is why we had the Review Body, which could come to different arrangements at that time. But opinions have changed somewhat in discussions, and the important factor now is that the people involved on both sides of industry—though more on one side than on the other—wish to have the same protections as the rest of the United Kingdom.
There are differences in the order. We use different names for different organisations in Northern Ireland. We have the library boards, the education boards and various departments that are known by


different names. There are those variations, but those are the only ones. What is more, the fact that we have good industrial relations in Northern Ireland does not mean that we ought not to try to better them.
This order is not the end of the parcel. A No. 3 order will have to be brought forward, and we are in consultation about it. Some of the more legal aspects have to be looked at as well. But this is at a very early stage yet.
The cost of this is a very small percentage—about one-quarter of 1 per cent.—of the wage bill. That is what it has been reckoned at. It is a very small price to pay for industrial peace.

Question put and agreed to.

Resolved,
That the Industrial Relations (No. 2) (Northern Ireland) Order 1976, a draft of which was laid before this House on 9th November 1976 in the last Session of Parliament, be approved.

Orders of the Day — STATUTORY INSTRUMENTS, &c.

Motion made, and Question put forthwith pursuant to Standing Order No. 73A (Standing Committee on Statutory instruments, &amp;c.).

Mr. Deputy Speaker (Mr. Oscar Murton): With the permission of the House, I propose to put together the Questions on the four motions relating to double taxation and regional employment premium.

Orders of the Day — INCOME TAX

That an humble Address be presented to Her Majesty, praying that the Double Taxation Relief (Taxes on Income) (Republic of Ireland) Order 1976, be made in the form of the draft laid before this House on 5th July 1976 in the last Session of Parliament.—[Mr. Tinn.]

Question agreed to.

To be presented by Privy Councillors or Members of Her Majesty's Household.
That an humble Address be presented to Her Majesty, praying that the Double Taxation Relief (Taxes on Income) (Republic of Ireland) (No. 2) Order 1976, be made in the form of the draft laid before this House on 4th November 1976 in the last Session of Parliament.—[Mr. Tinn.]

Question agreed to.

To be presented by Privy Councillors or Members of Her Majesty's Household.
That an humble Address be presented to Her Majesty, praying that the Double Taxation

Relief (Taxes on Income) (Philippines) Order 1976, be made in the form of the draft laid before this House on 4th November 1976 in the last Session of Parliament.—[Mr. Tinn.]

Question agreed to.

To be presented by Privy Councillors or Members of Her Majesty's Household.

Orders of the Day — TAXES

That the Regional Employment Premium (Variation of Amounts) Order 1976, a draft of which was laid before this House on 5th November 1976 in the last Session of Parliament, be approved.—[Mr. Tinn.]

Question agreed to.

Orders of the Day — SOUND BROADCASTING (JOINT COMMITTEE)

Ordered,
That so much of the Lords Message yesterday as relates to the appointment of a Committee to consider the implementation of the Resolutions of both Houses in favour of the establishment of a permanent system of sound broadcasting of their proceedings and to make recommendations be now considered.—[Mr. Tinn.]

So much of the Lords Message considered accordingly.

Ordered,
That a Select Committee of five Members be appointed to join with the Committee appointed by the Lords to consider the implementation of the Resolutions of both Houses in favour of the establishment of a permanent system of sound broadcasting of their proceedings and to make recommendations.

Ordered,
That Sir Paul Bryan, Mr. Robert Cooke, Mr. Ben Ford, Mr. William Price and Mrs. Ann Taylor be members of the Committee.

Ordered,
That the Committee have power to send for persons, papers and records; to report from time to time; and to sit notwithstanding any adjournment of the House.

Ordered,
That Two be the Quorum of the Committee.

Ordered,
That the Minutes of the Evidence and Memoranda reported from the Joint Committee on Sound Broadcasting, on 15th November 1976, in the last Session of Parliament, be referred to the Committee.

Message to the Lords to acquaint them with such of the said Orders as are necessary to be communicated to their Lordships.

Orders of the Day — PENSIONERS (COST OF LIVING)

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Tinn.]

1.25 a.m.

Mr. Fergus Montgomery (Altrincham and Sale): It is now almost 1.30 a.m., which is not the best time to make a speech, but I am grateful for this opportunity to raise the issue of the problems facing retirement pensioners as a result of rising prices. This Adjournment debate arose out of an answer that I received on 15th November from the Under-Secretary of State for Prices and Consumer Protection. I apologise to the Under-Secretary for Health and Social Security, who has been kept here so late to answer the debate, because he is not the culprit. I would have liked the Under-Secretary of State for Prices and Consumer Protection to reply.
On 15th November, the Minister stated that the Retail Price Index had risen by 61 per cent. between February 1974, when the Labour Government first came into office, and October 1976, the month for which the latest figures were available. He went on to say that pensions had increased by 96 per cent. in the same period. That was a misleading statement for any Minister to make.
From February 1974 to October 1976 pensions rose by 69·6 per cent. for a married couple, and for the period from February 1974 to November 1977 the increase will be 96 per cent. That makes no allowance at all for price rises between now and November next year.
Some time ago the Chancellor of the Exchequer made the proud boast that by the end of 1976 the rate of inflation would be down to single figures. It is a good thing that people take very little notice of the Chancellor's forecasts, because he is always wrong. He is the same man who announced, during the October 1974 election, that the rate of inflation was running at 8·4 per cent. How anybody could have believed that is beyond my comprehension.
We know that prices will rise dramatically and that it will not be too long before the November pension increase will be eroded. Yet the complacency goes on. Yesterday, the Treasury said that pensioners had never had it so good. If I said that to pensioners in my constituency

I would be laughed out of court. The suggestion that they are having a bonanza is a cruel joke.
I get letters from pensioners explaining the difficulties that they have to endure and the problems of eking out a living. Their modest savings have declined because of inflation. They are faced with increasing fuel bills, soaring food costs, and rising rates and fares. It is small wonder that they say they cannot afford any new clothes, that they have great difficulty in buying replacement bedding, and that they cannot afford the amount of heat they require. This is borne out by the increase in the number of deaths from hypothermia.
The Government acknowledged the difficulties that the pensioners were experiencing when they increased the heating allowance for those receiving the supplementary pension, but by doing this they created even more problems. They gave nothing to those on the borderline, many of whom needed help just as badly. The Government have agreed that the elderly need more time to pay their winter fuel bills, but they have merely put off the day of reckoning. Those bills still have to be paid. The recent increase in the cost of gas and electricity has added to the existing burden.
The two categories of pensioner for whom I feel particularly sorry are the very old and those who have no relatives. The former had little opportunity to save during their working lives, because they lived through the depression. The latter cause me sometimes to wonder whether the Welfare State is all that it is cracked up to be. Far too many people of my generation seem to do little or nothing for elderly relatives, and tend to take the view that the State should support them. During the poverty of the depression there seemed to be more thought for others. Over the years we have tended to become a more selfish society.
There is a famous hymn which begins
God moves in a mysterious way
His wonders to perform.
We all know that the Government are incapable of performing wonders, but they do things in a mysterious way. Until this year the pension increases were always announced in March and came into effect in November. An increase was largely based on the rate of inflation from March the previous year up


to the March when the increase was announced.
Under normal circumstances, therefore, the increase that came into effect this November would be based on the Retail Price Index for March 1975 to March 1976. But the Government, to suit their own ends, changed the calculations this year. They were crafty, and realised that if they calculated the rise this year under those circumstances they would find it very expensive, due to the massive increase in the Retail Price Index. What they have done is to change the rules, so that the pension increase announced in March 1976 and paid in November 1976 was calculated on the increase in prices from November 1975 to March 1976 and on what they thought the increase in prices would be between March 1976 and November 1976.
I have already said what I think about the Chancellor's forecasts. It is disgraceful that the Government should have decided that the last pension increase should be so dependent on the judgment of a man who would be hard pressed to tip the winner in a one-horse race.
Now, whenever one raises the question of pensions with Ministers one is always bombarded with statistics. We all know that statistics can be used to prove just about anything. In February 1974 the pension for a married couple was £12·50. In November 1975 it was £21·20, and at the time of the last increase—November 1976—it was raised to £24·50. So, no doubt the Government will proudly say that this proves an increase between February 1974 and November 1975 of 69·6 per cent., and with even greater glee will point out that from February 1974 to November 1976 pensions have increased by an enormous 96 per cent.—cleverly omitting to point out that the increase has to last until November 1977.
I think that these figures need to be examined more closely. The pension for a married couple increased by 69·6 per cent. between February 1974 and 12th November 1976—that is the weekend before the latest increase. But at the same time the all-items retail price index has risen by 60·8 per cent. between February 1974 and October 1976. I am sorry that I cannot give a more up-to-date figure, but the relevant figures for November are

not due for publication until 17th December. The increase in the all-items retail price index is bad enough, but between February 1974 and October 1976 the index of food prices rose by 67·8 per cent., which is only 1·8 per cent. less than the pension increase.
Now let us look at the more generous assertion of the Government that between February 1974 and November 1976 the increase in pension for a married couple amounts to 96 per cent. They conveniently ignore the fact that this increase has to last until November 1977, and no one doubts that prices will continue to rise. The Chancellor's estimate is that prices will rise by about 15 per cent. on a yearly basis. No doubt the Chancellor will be wrong again in his assessment. I hope that price rises will be lower than his forecast, but I have a horrible feeling that in fact they will be greater. So, during 1977 the increases in the Retail Price Index will be continually eroding the value of the pension.
It could well be that by mid-1977 prices will have risen since the Labour Government took office by the same amount in purchasing power as pensions have increased over the same period. On this basis the pensions increase will only just have kept abreast of inflation. This really does make a mockery of all the fine words that we heard from the Labour Party in the General Election of February 1974, when they promised to make life so much better for the pensioners of this country.
Today—or, I should say, yesterday, in view of the lateness of the hour—my hon. Friend the Member for Romford (Mr. Neubert) asked the Chancellor of the Exchequer
what was the purchasing power of the average pensioner couple in February 1974, on 30th October 1976 and on 16th November 1976 based on the internal purchasing power of the £ sterling at 100p in February 1974, 62p on 30th October 1976 and on 16th November 1976.
The answer was:
The retirement pension for a married couple was £12·50 in February 1974, £21·20 on 30th October 1976 and £24·50 on 16th November 1976. If the internal purchasing power of the pound were taken as 100p in February 1974 and its value on both 30th October and 16th November 1976 as 62p then the relative purchasing power of these pensions by comparison to February 1974 would be £12·50, £13·15 and £15·20 respectively.


That means that in real terms the purchasing power of the pension from February 1974 to November 1976 has increased by £2·70.
I have always believed that it was futile to talk to people about the size of the pension. The important thing to all of them is the amount of goods that the pension will buy. I am sure that the Minister is aware that The Guardian runs a feature called "Shopping Basket", which assesses the weekly increase in the cost of food for a low income family with two children. It is estimated that from November 1975 to September 1976—a period of less than a year—the increase for food alone for this typical family was £2·39½. So, for a pensioner married couple, the figure would be about £1·20, which would leave them £2·10 out of their latest increase to pay for all the other price increases in the pipeline until November 1977. To put it another way, from November 1975 to November 1977 the percentage pension increase is 15·6 per cent., and over the same period I believe that the Retail Price Index will go up by over 30 per cent.
I hope, therefore, that the Minister will explain the estimate made of the rate of erosion of the latest pension increase and state when, in 1977, he expects to see the complete erosion of the latest pension increase.
I apologise again to the Minister for the fact that he had to stay to reply to this debate. As I explained at the beginning, I should have preferred another Minister to be here, because I believe that that Minister misled the House in November.

1.39 a.m.

The Under-Secretary of State for Health and Social Security (Mr. Alfred Morris): I am grateful to the hon. Member for Altrincham and Sale (Mr. Montgomery) for raising this topic on the Adjournment. As I know he will appreciate, a great deal of my ministerial work is concerned with the elderly, not least with giving practical help to the most needful of elderly people. Thus, I listened to his speech with a very personal interest.
This is a caring Government, with a very good record in tackling the problems that old people face. Our aim has

been not only to protect but to improve the living standards of the elderly. Notwithstanding our inheritance and the daunting economic circumstances with which we have to deal, our achievements show that we were wholly sincere in making our pledges to give very high priority to elderly people. Whether we should have spent as much as we have on improving social benefits may be a matter of controversy, but there can be no dispute about the fact that we have improved social benefits on an unprecedented scale since 1974.
Our answer to the continuing problem of inflation is twofold: first, to bring down the rate of inflation, which is in everyone's interest; and, secondly, to uprate pensions to counter the effects of inflation on the elderly and others in special need.
Retirement pensions have now been uprated four times by the present Government. With the uprating last month, pension rates have now risen by 97 per cent., in cash terms, since our predecessors' last uprating in October 1973. This is well ahead of the 69 per cent. increase in prices over the same period. In the last three years, we have increased public expenditure on pensions and other social security benefits by about £1,000 million in real terms, taking account of price increases. At a time when we have been under strong and sustained pressure to reduce public expenditure, this is no mean achievement.
We are all aware of the dangers of inflation at annual rates as high as 27 per cent., which we experienced 18 months ago. Since then, we have cut the annual rate to under 15 per cent. Hon. Members will regret that a disappointing rate of growth, the severest drought for centuries and other factors interrupted the fall in the rate of inflation, but our anti-inflation policy is continuing, and deserves maximum support, not least from those concerned with the welfare and well-being of the elderly. It is inevitable, until we conquer inflation, that the value of pensions falls between upratings. Even so, in October 1976, the real value of the pension was still in excess of the rate introduced by the previous Government in October 1973.
The Government have been active to protect pensioners from price rises. We came into office pledged to improve their position. In our 1974 manifesto, we promised to raise the level of pensions to £10 a week for a single person and to £16 for a married couple. We brought these rates into force—in record time—by the end of July 1974. These amounts seem unimpressed now, but they represented an increase of 29 per cent. in cash terms over the last rates introduced by our predecessors in October 1973 only 9 months before. In real terms, that is after taking account of price rises, they represented an increase of 13 per cent. over the October 1973 rates. This was the largest increase both in cash and real terms achieved at any time since the National Insurance Scheme was introduced in 1948. I am sure that the hon. Gentleman will agree that this really was impressive.
We had also promised to keep pensions in line with the movements in the general level of earnings or prices, whichever would give pensioners the better deal and, when we came into office, we gave that commitment the force of law. This again was an important breakthrough for the elderly. The law provides that pensions and other benefits must be reviewed at least annually, but we had pledged to go further and we kept that promise also.
In 1975, because of the high rate of inflation, we increased pensions twice—in April and in November. Pension rates went up by 16 per cent. in cash terms in April and by 15 per cent. in November. Our purpose was to ensure that we maintained the real value of pensions. In fact, we did more than this. Between October 1973 and November 1975, pensions rose by 72 per cent., whereas prices rose by 49 per cent. Pensions had therefore risen to a new peak with an increase in real value of 15 per cent.
Moreover, our anti-inflation measures were bearing fruit. By July 1976 the annual rate of inflation had fallen from 27 per cent. in August 1975 to 13 per cent. and we decided that we could return to annual upratings. Last month, we raised pensions again by 15 per cent.
It was this latest uprating that brought pension rates to 97 per cent. in cash terms above our predecessors' last uprating in October 1973—

Mr. Montgomery: The Minister keeps going on about the generosity of this Government and the enormous cash increases they have given to pensioners. Will he bear in mind the enormous rise in inflation under this Government, as compared with the last Tory Government?

Mr. Morris: I am not going on about the generosity of this Government. 1 passionately believe that elderly people, not least disabled people among the elderly, deserve the highest priority. What I am saying is that in very difficult economic circumstances the Government have given the highest priority to elderly people. I am saying that we have done a great deal of good work for the elderly in extremely difficult economic circumstances.
I said earlier that at the time of the last uprating we raised pension rates by 97 per cent. since our predecessors' last uprating in 1973. Pensions are still keeping well ahead of the rise in prices, while supplementary pensions have similarly improved.
I know that mere figures of this nature mean little to the majority of pensioners. As someone said recently, statistics do not make a noise in the frying pan. Pensioners see, and are understandably concerned about, the price rises in the shops. But the effect of what we have done—and here I pay a sincere tribute to my late colleague and friend Brian O'Malley—has been to increase the purchasing power of the pension by nearly one-sixth over the last three years after allowing for the high rate of inflation we have experienced over that period. To this extent pensioners have done better than the majority of the working population.
The comparisons I have made have been with the movements in the general index of retail prices, which reflects the changes in the make-up of the average family budget. The pensioners' index reflects that of average pensioner households and although pensioners spend a higher proportion of their income on particular items such as food and heating the movements of the two indices have diverged little.
Some items have gone up in price more than others—particularly food and fuel. The question of food is important. Food subsidies are a matter for my right hon.


Friend the Secretary of State for Consumer Protection. But one of the primary arguments in 1974 for allocating resources to food subsidies was that they gave the greatest assistance to those on low incomes, including pensioners, for whom they have been of significant help.
Food subsidies are now running at an annual rate of over £400 million and apply to the basic foods—milk, butter, cheese, bread and flour. This is, of course, of undoubted importance in helping to keep food prices down.
As the hon. Gentleman knows, because of the urgent need to reduce public expenditure, food subsidies are being run down, although this is being done as gradually as possible to minimise, as far as practicable, the impact on consumers. But this run down must be set against the background of the considerable improvements in the real value of pensions to which I have referred.
This run down will inevitably have some, albeit a minor, effect on the index of retail prices but pensioners are again protected, in that the law requires that pensions have to be increased in line with prices or earnings, whichever is the more beneficial.
There has been a great deal of discussion about the green pound. There are those who argue insistently for a devaluation of the green pound. As hon. Members will be aware, the EEC Commission has recently proposed a devaluation of 4½ per cent. in the green pound. But my right hon. Friend the Prime Minister, speaking in the European Council, has made it clear that the Government cannot at the present time accept any devaluation, because of its effects on food prices and, hence, on the Government's attack on inflation. It is clearly impossible to go on for ever holding our farmers' returns fixed whilst their costs rise, but for the time being the Government regard their attack on inflation as the overriding priority.
As to fuel costs, pensioners who qualify for supplementary pensions can receive further help with their fuel bills. Although fuel costs are included in the overall scale rates for supplementary pension to meet living costs, pensioners who either need extra heating on health grounds or have unusually expensive homes to heat may receive extra heating

additions. These additions were increased in November by 27 per cent. Furthermore, in very exceptional cases, a lump sum payment may be made towards a supplementary pensioner's fuel bill. The sums paid under the supplementary pension scheme vary according to the circumstances of the pensioner, but there is considerable discretion for assistance to be given towards the costs of high fuel bills.
Now we are doing even more than this in providing extra help with electricity bills this winter for the consumers who seem likely to have the greatest difficulty with their fuel bills. My right hon. Friend the Secretary of State for Energy recently announced that a scheme is being worked out to give recipients of supplementary benefit and family income supplement a discount on their electricity bills, the cost of which will be met by the Government. Electricity is used by virtually all these consumers and, in the case of those in all-electric households, tends to lead to the heaviest fuel bills. We recognise that the scheme will not be perfect in meeting all needs and circumstances, but its importance is clear and undeniable. With the limited resources available we decided to give extra help to those who are likely to be hardest pressed.
To help others, a code of practice is being designed to protect genuine hard ship cases from disconnection and to help them make suitable arrangements for the payment of their gas and electricity bills. The code is now the subject of final discussions with the two industries and the unions concerned and between my right hon. Friend and the local authority associations and staff representatives. Once agreed, the code will be promulgated by the industries. The latest draft was recently placed in the Library of the House of Commons.
This is an indication of the way in which we have kept our pledges. There is no complacency. All in all, as a result of the four upratings in July 1974, April 1975, November 1975 and that of last month, and other improvements in social security benefits, it is estimated that we have increased public expenditure on pensions and other social security benefits by about £1,000 million in real terms—that is, after taking account of price increases—compared with the expenditure following the last increase by the previous Government in October


1973. About half of this has gone to pensioners. This is a massive shift of resources in favour of the most vulnerable members of society.
It is said that we should have done more—that we should have increased pensions by a higher amount and more frequently. But what we have done has been achieved in a period very severe economic difficulty and the constraints on public expenditure are even greater now than they were. Some idea of the costs involved are that the uprating last month amounts to an extra £1,400 million in a full year. More than half of that is for retirement pensions. I think that this shows that we have been far from complacent. Indeed, at a time of considerable pressure to reduce public expenditure, our achievements in increasing the purchasing power of pensions are really quite remarkable.
We have been under daunting pressure from people who insist again and again and again that we are spending too much in this field. I do not say that this is the point of view of the hon. Member for Altrincham and Sale, but he knows that there are many other people who argue relentlessly that the Government are spending far too much in social security.
I have explained, moreover, that the pensioners take a large part—

The Question having been proposed after Ten o'clock on Thursday evening, and the debate having continued for half an hour, Mr. DEPUTY SPEAKER adjourned the House without question put, pursuant to the Standing Order.

Adjourned at five minutes to Two o'clock.